Ethnic Hierarchy in the Japanese Economy: Economic Effects of Restricting Non-Japanese Workers to Occupational Niches (2018)

This paper will analyze the economic implications of restricting the occupational choices and social mobility of non-Japanese workers in the Japanese economy. The paper will begin by using labor market segmentation theory (LMS) and split labor market theory (SLM) as bases to explain why formal and informal occupational restrictions exist in Japan. After defining these theories, the paper will then explore the historical context behind Japan’s restrictive labor policies by reviewing literature on Japanese cultural and genealogical “homogeneity” and its effects on Japan’s immigration, integration, and labor policies. After identifying the cultural impetus behind labor restrictions, the paper will then review the social and economic realities faced by non-Japanese workers. The paper will assert that restricting foreign workers to occupational niches has negative effects on the economy because these restrictions stifles economic growth and foreign workers’ social mobility