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Economic Downturn, Unemployment, and Policy Reform in Germany and Japan:Wage Moderation and Compensation Policies in Coordinated Market Economies

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Abstract:

Between 1998 and 2001 Germany and Japan enacted pension and tax reforms as part of a broader effort to revive the economy and reduce unemployment. However, the German reform maintained fiscal discipline, a generous pension system (by increasing the role of private pensions), and passive labor market policy. In contrast, Japan resorted to deficit spending, while retrenching public pension and tailoring labor market policies to keep the elderly active. The recent reforms have reinforced the divergent policy paths of Germany and Japan, which can be explained by (a) the arrangements that facilitate coordinated wage moderation where the unions are intermediately strong or decentralized and (b) how different arrangements shape policies to reward wage moderation. By explaining the source of difference among the two top wage coordinated economies, this article cautions against analyses that treat Germany and Japan as similar regimes.

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wage (197), polici (132), coordin (128), employ (124), union (96), moder (93), govern (92), germani (90), japan (87), market (86), unemploy (80), economi (74), pension (68), welfar (58), tax (57), central (56), social (51), labor (50), reform (47), corpor (46), econom (46),

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Keywords: political economy, Japan, Germany
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Name: American Political Science Association
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MLA Citation:

Hiwatari, Nobuhiro. "Economic Downturn, Unemployment, and Policy Reform in Germany and Japan:Wage Moderation and Compensation Policies in Coordinated Market Economies" Paper presented at the annual meeting of the American Political Science Association, Boston Marriott Copley Place, Sheraton Boston & Hynes Convention Center, Boston, Massachusetts, Aug 28, 2002 <Not Available>. 2009-05-26 <http://www.allacademic.com/meta/p65285_index.html>

APA Citation:

Hiwatari, N. , 2002-08-28 "Economic Downturn, Unemployment, and Policy Reform in Germany and Japan:Wage Moderation and Compensation Policies in Coordinated Market Economies" Paper presented at the annual meeting of the American Political Science Association, Boston Marriott Copley Place, Sheraton Boston & Hynes Convention Center, Boston, Massachusetts Online <.PDF>. 2009-05-26 from http://www.allacademic.com/meta/p65285_index.html

Publication Type: Conference Paper/Unpublished Manuscript
Review Method: Peer Reviewed
Abstract: Between 1998 and 2001 Germany and Japan enacted pension and tax reforms as part of a broader effort to revive the economy and reduce unemployment. However, the German reform maintained fiscal discipline, a generous pension system (by increasing the role of private pensions), and passive labor market policy. In contrast, Japan resorted to deficit spending, while retrenching public pension and tailoring labor market policies to keep the elderly active. The recent reforms have reinforced the divergent policy paths of Germany and Japan, which can be explained by (a) the arrangements that facilitate coordinated wage moderation where the unions are intermediately strong or decentralized and (b) how different arrangements shape policies to reward wage moderation. By explaining the source of difference among the two top wage coordinated economies, this article cautions against analyses that treat Germany and Japan as similar regimes.

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Document Type: .pdf
Page count: 25
Word count: 11908
Text sample:
Economic Downturn Unemployment and PolicyReform in Germany and Japan: Wage Moderation and Compensation Policies in Coordinated Market Economies Nobuhiro Hiwatari University of Tokyo Email: hiwatari@iss.u­tokyo.ac.jp V.6 (August 2002) Abstract Between 1998 and 2001 Germany and Japan enacted pension and tax reforms as part of a broader effort to revive the economy and reduce unemployment. However the German reform maintained fiscal discipline a generous pension system (by increasing the role of private pensions) and passive labor market policy. In contrast
kaikaku: sono rinen go genjitu Kikan nenkin to koyō 18­3 (1999) 4­43. 35 Cf. ft. 3 36 Cf. ft. 4 37 Geoffrey Garrett & Christopher Way ``The Sectoral Composition of Trade Unions Corporatism and Economic Performance '' in B. Eichengreen J. Frieden & J. von Hagen (eds.) Monetary and Fiscal Policy in an 23 Integrated Europe (Berlin: Springer 1995) 38­61; Geoffry Garrett & Christopher Way ``Public Sector Unions Corporatism and Wage Determination '' in Torben Iversen Jonas Pontusson &


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