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The Vertical Division of Labor and Japanese Outward FDI:
Impacts on Human Capital Deepening in Japan
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| Keiko Ito and Kyoji Fukao
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| This paper empirically examines the impact of recent changes in Japan’s trade patterns on domestic factor markets. According to our factor content analysis, Japan’s net-exports changed in a direction that Japan has come to export more physical and human capital-intensive products over the past two decades. On the other hand, a major part of the macro-economic change in the capital-labor ratio and the change in the skilled-labor ratio can be attributed to a within-industry shift rather than a between-industry shift. Our empirical analysis provided evidence that the deepening of international division of labor contributed to skill upgrading in Japan. Vertical intra-industry trade and outward FDI had a strong positive effect on the increase in the share of skilled workers.
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| Copyright (C) 2003 by Institute of Economic
Research.All rights reserved. |
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