The logic of Japanese employment practices

In discussing the logic of employment practices, this chapter provides a stylized description of large Japanese firms in accordance with the work of Masahiko Aoki who has been credited for developing the best-known theory of the Japanese firm (Fransman 1995). Aoki (1988) introduced the ‘J-firm’ as an explanatory abstraction to analyse the specific economic rationale of the large Japanese firm. This choice for a ‘stylized’ description results in an ‘undersocialized’ analysis (Granovetter 1985) but is an important step towards the economic analysis of the employment practices. Moreover, the institutional discussion initiated in the previous and the case studies in later chapters add the necessary context. Comparable arguments justify the decision to focus on the employment practices at large firms because they constitute the natural point of reference. Practices like lifetime employment may only apply to a minority of employees but shape the working conditions of many others; because they provide a normative model and because of the relationship that exists between regular and non-regular employment.