Essays on labour market segmentation in Japan

Properly assessing labour market segmentation and its outcomes are essential for the debate of the policy related to atypical work. This thesis document the labour market segmentation in Japan, construct the model, and do counterfactual simulation to contribute to the policy making. The first chapter documented a rise in atypical jobs and labour market segmentation in Japan. The main findings are the follows. Firstly, there is labour market segmentation between atypical and standard workers in Japan. Secondly, the institutional setting largely affects labour market outcomes. Thirdly, there is a small relationship between educational attainment. The model constructed in the second and the third chapter reflect the analyses of the first chapter. The second chapter constructs a labour market matching model with heterogeneous jobs and workers that incorporates on-the-job search and different turnover rates. It extends the model of Dolado et al. (2009) by adding different turnover rates to heterogeneous jobs. In line with the paper of Dolado, we prove that the introduction of OTJ search enhances the likelihood of having an equilibrium with cross-skill matching even if the model contains different turnover rates to heterogeneous jobs. The quantitative implications give the prediction that the unemployment rate of low-productivity workers increases, inequality grows, and welfare decreases as skill-biased technical change proceeds. The third chapter constructs a search matching model, which incorporates endogenous labour market participation into the segmented labour market by combining the models of Albrecht and Vroman (2002) and Garibaldi and Wasmer (2005) to investigate how to raise the labour force participation rate in the segmented labour market. The quantitative implications predict that the decrease of the value of home production, such as the rapid spread of autonomous robotic vacuum cleaners and cheap housekeeping services, leads an increase in employment.