affiliation:
I am a Research Associate at the Faculty of Economics, Keio University, Japan. I received my Ph.D. in
Economics from University of Tokyo in 2023.
interests:
Labor, Macro Labor, Economic History
Esp. human capital, skill & task, wage inequality; technological change & adoption; job search,
vacancy, matching & sorting; firm dynamics & growth
contact:
zhuxuanli46 at gmail.com
zhuxuanli at keio.jp
upcoming presentations:
[+]
March, 2024. Tokyo Labor Economics Workshop @ University of Tokyo
May, 2024. Empirical Microeconomics Seminar @ Waseda University
June, 2024. Asian Meeting of the Econometric Society @ Zhejiang University
July, 2024. NBER Japan Project Meeting @ Tokyo
working paper:
Factory Automation, Labor Demand, and Local Labor Market
w/ Daiji Kawaguchi & Tetsuji Okazaki
[abstract]
[draft]
(2024/04)
Abstract: This study examines the effects of automation on labor demand, focusing on the power loom adoption in Japan’s early 20th century silk-weaving industry. Exploiting plant-level panel data, we find that, compared to non-adopted plants, power loom adaption increased the employment and wages for adult male workers likely engaged in engineering tasks. Female adults, the main manual workforce, experienced stable employment with wage increases despite displacement and task transitions. However, equilibrium spillover effects from imperfect labor market competition led to a decrease in overall female adult employment in highly mechanized areas, primarily driven by the exit of low-wage plants.
Posted Wage Inequality
[abstract]
[draft]
[slide]
(2023/02; jmp; major revision coming soon)
[app]
Abstract: This paper introduces a novel method to study the determinants of wage inequality in the labor market, utilizing online job posting data and machine learning algorithms. This method offers new insights by opening the black box of the multidimensional worker and job heterogeneity, which also enables to identify the most important skills and tasks that account for sorting between worker/job and firm components. Applying our method to the posting data of a Chinese online job board, we estimate different wage dispersion components and find clear evidence of firm wage premiums and positive firm-job sorting, with the shares consistent with those observed in many developed countries. During the estimation procedures, our machine learning approach reveals a data-driven skill and task structure featured by different levels of specificity. Variations in occupation-specific skills and tasks are the primary determinants of wage variances, contributing through both channels of job differences and sorting with firm pay policies. This is especially prominent in high-skill occupations, which are characterized by large wage dispersions. Meanwhile, in low-skill occupations, education- and experience-related skills and tasks, which are relatively less specific, play an equal or sometimes more important role. In contrast, variations in the most general skills, whether cognitive or interpersonal, have minimal impact on posted wage inequality.
Posted Compensation Inequality
[abstract]
[draft]
[slide]
(2023/05)
Abstract: This paper studies the supply of non-wage compensations across different types of firms and jobs, as well as their impact on wage determination. Taking advantage of the data from a Chinese online job board where most firms document pecuniary and nonpecuniary amenities to attract applicants, we extract a large set of non-wage compensations that employers and jobseekers recognize as essential for their matching in the labor market. We find that different firms in different jobs also provide different non-wage compensations in a systematic way. In particular, high wage-premium firms sorted with high skill jobs also more likely provide advanced insurance packages, backloading wage and stock options, professional coworkers, and flexible work-time, and such amenities are positively correlated with posted wage. In contrast, low wage-premium firms sorted with low skill jobs more likely to offer weekend, holiday, and regular work-time, and such amenities are strongly subject to compensating differential. To account for these findings, we propose a new theory that combines the compensating differential with two new forces: efficiency compensation and (productivity-based) firm-worker sorting. This framework not only reconciles the inconsistency between our data and the incumbent theories but also offers important general insights into the labor market inequalities.
Establishment Dynamics in Post-War Japan: Missing Entry and Shrinking Size
[abstract]
[draft]
[slide]
(2022/04)
Abstract: We study the long-run evolution of the establishment dynamism in post-war Japan and document three newly found facts. First, the entry rate exhibited a continuous and secular decline between the late 1950s and the late 1990s, combined with a first declined and then stagnated low exit rate, generating a significant aging in the population of the Japanese business units. Second, the average employment size of establishments fall precipitously in the 1960s and 1970s across all age groups, especially in the manufacturing and construction sectors, and from the 1980 onwards, the entry size rebound mainly due to the increase in the wholesale&retail and service sectors. Third, the average life cycle growth of a typical cohort observed a significant downward shift in the 1960s and 1970s in the manufacturing and construction sectors, dampening the Japanese market dynamics in the following years. We then evaluate the performance of various potential derivers in explaining these phenomenons in a standard firm dynamics model. In particular, we examine if the changes in labor supply growth rate, in entry cost, fixed cost and exit value, and in size-correlated labor cost or labor adjustment cost can account for the entry decline and the fall in the average size and the lifecycle growth rate. The results indicate that although the change in the labor supply growth rate can account for a majority of the long-run entry rate decline, the model simply translates the trend of labor supply growth to the trend of entry rate in the transitional path due to a faint compositional effect. Moreover, while a moderate decline in the fixed operation cost can match the downward shifts in average size and lifecycle growth, the labor market distortions fail to explain these changes.
work in progress:
Japanese Programmers and Technology Adoption
[abstract]
(draft available upon request)
Abstract: This paper investigates the role of labor market institutions in shaping human capital investment and technology adoption by focusing on the IT sectors of Japan and China. Leveraging online job posting datasets, we find that Japanese IT firms are more inclined to offer on-the-job training and rely on older technologies, while Chinese firms prioritize hiring skilled workers and adopting newer technologies. We develop a two-period model that encapsulates the interactions between human capital investment, technological shifts, and labor market frictions. Contrary to conventional models positing that firms and workers are perfect substitutes in investing in human capital, we argue that their roles are asymmetrical and influenced by the technological regime and labor market structure. The model reveals that the rigidity of Japan’s labor market suppresses workers’ incentives but enhances firms’ incentives for human capital investment and technology adoption, despite its technical efficiency, while the fluidity of China’s labor market does the opposite. We further utilize our model to explain how labor market institutions can be both cause and consequence of technology adoption and economic development by suggesting that labor market structures could be aligned with the dominant technological regime for optimal human capital investment, and that a misalignment due to technological change afterwards could lead to significant economic inefficiencies.
Revisiting The Race between Education and Technology
What and Why Task-biased Technological Change
The Rise of Efficiency Compensation
If Knowledge Flows Everywhere, Why Does Academia Not Converge