Thursday, November 6, 2008

Relatively unmotivated Japanese workers: trend or abberation?

The WSJ reported on an intriguing trend a few days ago. Some young Japanese employees, many of whom have seen their parents work hard for little reward, are preferring easier jobs with less pay to more demanding jobs with better compensation. Executivies in certain companies are actually instructed to "break news of promotions gently."

As Tyler Cowen says, if you aren't thinking about Japan every day, you've yet to wake up. The psychological explanation of this behavior relies on rational choice following from the Easterlin Paradox. If your happiness isn't going to increase much from higher income, what's the point of expending so much time and energy to achieve it?

I know that the Easterlin Paradox applies to nations and not individuals, and I know that this report is probably an abberation instead of a future trend. But I must ask, what if? What then?