Labor, Health and Education in Asia‐Analysis of Micro Data: Editors' Overview

• DOI: http://doi.org/10.1111/aepr.12172
• Date: 01 January 2017
• Published date: 01 January 2017

Labor, Health and Education in Asia-Analysis

of Micro Data: Editors’Overview

Takatoshi ITO,

1

Kazumasa IWATA,

2‡

Jong-Wha LEE,

3

Colin MCKENZIE

4

†,

and Shujiro URATA

5

1

ColumbiaUniversity,

2

Japan Centerfor Economic Research,

3

Korea University,

4

Keio University,

5

WasedaUniversity

JEL codes: A20, D80, G22, I3,I26, J13, J14, J22, J24, J30, J31, J41, J46, J48, L11, L67, O1, O14, O17

1. Labor, Health and Education in Asia

A large consistent inflow of educated and skilled workers into the labor market was one

essential element for Asia’s economic development over the last four decades. Partly

thanks to significant improvements in the workforce’s quantity and quality, Asia was

able to catch up with advanced economies in terms of per capita income and living

standards.

In recent years, however, there are rising concerns about inadequacies in human

capital development and its poor performance in the region. Despite progress in the

quantity of education, measured in terms of school enrollment ratios and the years of

attained schooling, how to ensure the quality of education for all population groups still

remains as an overwhelming challenge for Asia. Many Asian countries face

inefficiencies of educational systems and poor educational outcomes at all education

levels. Some students in primary and secondary schools fail to learn appropriate

cognitive abilities, including numeracy, literacy, problem-solving ability and general

scientific knowledge, as well as non-cognitive abilities including perseverance,

conscientiousness, self-control, and trustworthiness. The knowledge and skills gained

at post-secondary schools are also often inadequate to meet the evolving demand for

skills that focus on technological sophistication and continue to upgrade the industrial

structure.

Advancing to a higher-income status requires a country not just to have a well-

educated and highly skilled labor force, but also an efficient labor market that matches

labor supply with demand and makes the best use of the human capital of the country.

The present labor supply–demand gaps are partly due to the barriers to labor mobility

and inflexibility of the labor markets. The labor markets in many Asian countries are

subject to multiple layers of regulation that deter the expansion of employment

opportunities as well as the structural transformation of the economy. Labor mobility

across regions and industries is often restrained and too costly, thereby, preventing an

efficient allocation of human resources in the economy. Asian countries must improve

†Correspondence: Colin McKenzie, Facultyof Economics, Keio University,2-15-45 Mita, Tokyo 108-

8345, Japan. Email:mckenzie@z8.keio.jp

‡

Jong-Wha Lee wasa guest editor for this issue of the AsianEconomic Policy Review.

doi: 10.1111/aepr.12172 Asian EconomicPolicy Review (2017) 12, 1–17

©2017 JapanCenter for EconomicResearch 1

bs_bs_banner

their labor markets to expand quality employment opportunities and address arising

job–skill mismatches.

A demographic transition in many Asian economies is now headed in an unfavorable

direction for their economic growth. Populations are aging rapidly with declines in the

populations of prime working-age, which exerts a negative impact on output growth.

Supportingthe elderly through healthcareand welfare has also arisen as a significantburden

for households and governments. Appropriate policies are called for to overcome the

emerging demographic challenges in aging societies.

This volume comprises papers and comments that address a wide range of labor,

health and education-related issues in Asia. The papers focus on analyzing the

impact of policies and regulations on the decision-making of individuals, households

and firms, and, thereby, on the education performance and labor market outcomes

in Asia.

The first paper by Sawada (2017) explores how Asian households make decisions in

response to a variety of disasters. His findings show that households adopt a variety of

coping strategies especially through credit and labor markets in response to the damages

caused by disasters.

The next two papers examine the impact of labor market policies on labor market

outcomes. Meng (2017) focuses on the impact of the 2008 Labor Contact Law on migrant

workers’labor market outcomes in China. Hasan et al. (2017) examine how labor

regulations and the associated enforcement regime influence the firm size distribution

and productivity in India’s apparel industry.

The fourth paper by Kondo (2017) explores the link between elderly health care

and labor supply behavior by estimating the effect of the availability of long-term care

facilities in the local area on the labor supply of middle-aged men and women in

Japan. The fifth and sixth papers examine education and skill developments. Wu

and Zhang (2017) analyze the effect of parental absence on the development of

children in rural China. Lee and Wie (2017) investigate the determinants of skill

proficiency, and the impact of adult skills on labor market performance in Japan

and Korea.

All of the six empirical papers included in this volume use micro data available

from an Asian country or a number of Asian countries. Some adopt existing data

from household-level, firm-level and labor force surveys, while others construct new

datasets, such as long-term care facilities in Japan and student performance from

China’s Hunan province. Information about the source and availability of the data

is provided clearly.

More systematicstudies based using micro data shouldbe encouraged in order to create

comprehensive and targeted policies to enhance human capital development and labor

market outcomes in Asia. These studies could help policymakers and researchers to

understand better which factors affect individual decisions and how policy interventions

can produce anticipated (or unanticipated) outcomes.We hope the micro data and

empirical analyses in this volume can be useful for subsequent research and policy design

in this area.

Editorial Takatoshi Ito et al.

2©2017 JapanCenter for EconomicResearch