Institute of Social & Econ.Research
6-1 Mihogaoka, Ibaraki
Osaka 567-0047, JAPAN
Information about this author at RePEc
NBER Working Papers and Publications
|April 2003||Financial Distress and Employment: The Japanese Case in the 90s|
We examine quantitatively the extent to which financial distress in the 1990s affected employment behavior in Japan. Based on the firm-level panel data that include small firms, we estimate dynamic labor demand function, taking the impact of financial distress on employment into consideration. We find that the firm's ratio of debt to total asset exerts a significantly negative effect on employment of small firms. We also find that employment of small firms is sensitively affected by lending attitude of financial institutions.