Economic Consequences of Employment Quota System for Disabled People: Evidence from a Regression Discontinuity Design in Japan
This study examines the effect of Japanese employment quota system for disabled people on their employment. By using official data pertaining to Japan, we show that a levy-grant scheme increases the employment of disabled workers in Japan’s manufacturing industry. In addition, we find that small-sized firms hire disabled workers when increasing firm size, although they are not obligated to pay a levy. Finally, we use the increase in the number of disabled workers by the quota system as an instrumental variable (IV) to evaluate the impact of disability employment on a firm’s profit rate. The results of the fuzzy regression discontinuity design (RDD) suggest that an increase in the number of disabled workers does not necessarily decrease firms’ profit rates, which is in contrast to the results of the ordinary least squares (OLS) regression that suggest negative relationships between a firm’s profit rate and the number of disabled workers.
Year of publication: |
2014-09
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Authors: | Mori, Yuko ; Sakamoto, Norihito |
Institutions: | Graduate School of Economics, Hitotsubashi University |
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