Institutional Change and Screening Dynamics: How Japan's Lifetime Employment System Reshaped Higher Education
Abstract
This study integrates human capital theory and screening theory to analyze how Japan's lifetime employment system has reshaped
higher education screening mechanisms. The findings show that during the Stabilization Period (1945late 1980s), lifetime employment nurtured long-term internal training models within firms. In this context, higher education functioned primarily as a credential-based screening
device, with screening theory offering the dominant explanatory framework. During the Loosening Period (early 1990s2010s), as employment relationships became more flexible, the screening mechanism evolved into a model that combined composite signals with general skills,
reflecting a complementary relationship between the two theories. In the Diversification Period (2010s to the present), hybrid employment
has become the norm, shifting the focus of screening back to actual competencies and thereby strengthening the explanatory power of human
capital theory. The study concludes that the role of higher education is dynamically reshaped alongside changes in employment systems and
that its economic function is continuously reconstructed through institutional interactions.
higher education screening mechanisms. The findings show that during the Stabilization Period (1945late 1980s), lifetime employment nurtured long-term internal training models within firms. In this context, higher education functioned primarily as a credential-based screening
device, with screening theory offering the dominant explanatory framework. During the Loosening Period (early 1990s2010s), as employment relationships became more flexible, the screening mechanism evolved into a model that combined composite signals with general skills,
reflecting a complementary relationship between the two theories. In the Diversification Period (2010s to the present), hybrid employment
has become the norm, shifting the focus of screening back to actual competencies and thereby strengthening the explanatory power of human
capital theory. The study concludes that the role of higher education is dynamically reshaped alongside changes in employment systems and
that its economic function is continuously reconstructed through institutional interactions.
Keywords
Japan's lifetime employment system; Higher education screening; Human capital theory; Screening theory
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PDFReferences
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DOI: http://dx.doi.org/10.70711/wef.v3i7.8528
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