Published on September 30, 2020
Job titles and other details are as of the time of publication.
(The interview was conducted in Japanese and was thereafter translated into English.)

Workers’ “Innate Goodness” Creates a Positive Cycle

I specialize in labor economics and the sociology of work. I conduct research on human resource management and happiness.

In the field of human resources, I have worked on themes such as long working hours, improving productivity, work style reform, and Japanese-style employment practices. In the study of happiness, I use statistical data to discover “What makes people happy?” from sociological and economic factors. I will touch on happiness studies later.

I feel that human resource management has been receiving renewed attention after work styles changed significantly due to the effects of the coronavirus pandemic. However, when it comes to working from home, it is true that some companies are reluctant to promote the practice.

When employees work from home, employers cannot monitor what they are doing. Of course, people are supposed to be working during office hours even when they're at home, but managers can't escape the way of thinking that “workers are inherently bad.” This makes managers think, “Maybe they're slacking off,” or “If they were at the office, I could keep an eye on them.” As a result, the shift toward working from home is not progressing as anticipated. Many companies like this can be found in Japan.

In factories 100 years ago, when mass production and unskilled labor were the norm, worker management based on the view that workers are inherently evil may have served its purpose. However, in the modern age when services and information technology have progressed, this view is becoming outdated. In fact, companies that adopt the view that “workers are inherently good” (a.k.a. seizensetsu in Japanese) into their management and eliminate micro-management are attracting attention as rewarding work environments (for example, Mercari, Suntory, Unilever Japan, Netflix, etc.).

These companies have six conditions in common: trust and seizensetsu, delegation of authority and autonomy, psychological safety, autonomy and control, quality of social relationships, and remuneration based on performance.” They incorporate these conditions into management and achieve high levels of both extrinsic and intrinsic motivation. This approach creates a positive cycle that increases employee happiness and motivation, and improves productivity.

Many companies order people to come to work because they can’t see what they're doing when they're working from home. I believe it's time for Japanese companies to move away from this kind of micro-management that don’t allow companies to achieve the positive cycle.

Switched from Mechanical Engineering to Sociology to Delve Deeper into the Analysis of Human Behavior

When I was an undergraduate student, I majored in mechanical engineering. So why did I choose sociology? I get asked this question a lot. I was originally a science-oriented person, but while I was studying at university, I started to feel that a career as an engineer doesn’t suit me. Whether it be the sciences or the humanities, I found joy in being intellectually stimulated. So as a first step, I decided to pursue a career in consulting at Nomura Research Institute (NRI), a private think tank.

In the beginning, I had no idea what field I was interested in, so I accepted all kinds of projects. I was assigned to the research institute in Kamakura. I was immersed in analyzing various data while looking out over Sagami Bay. I also read a lot of books in various fields. Looking back, I am grateful to NRI for giving me such freedom. During those days, I came to realize that my field of interest was the analysis of human behavior.

For example, I conducted a project for a major telecommunications carrier to identify the desired features of next-generation mobile phones and to determine the targeted demographics. Since the request was from a private company, I would invariably make marketing-oriented inferences about what consumers want.

However, my interest did not stop there, and I went on to ask questions such as “Why do people want such a mobile phone?” and “How do user preferences change depending on social context?” The relationship between “context” and “human behavior” was a theme that I wanted to dig deeper into.

After that, I was fortunate enough to be given the opportunity from the company to study abroad. I chose graduate study at the University of Chicago to earn a master's degree in sociology. And in the same year that I went to Chicago, Prof. Gary Becker won the Nobel Prize in economics. By reading his work, I learned about human capital theory that would become my life's work.

Human Capital, an Economics Framework, Can Be Applied to a Wide Range of Human Behavior

Human capital theory, which was pioneered by Prof. Gary Becker, regards people as a productive entity, or simply capital. It is based on the rational premise that people can expect returns if you invest in them. The idea is that if you invest in yourself, you can increase your productivity, and you will reap greater benefits as a result of it.

What resonated with me is that it's not just about money and economics. When I learned that the economics framework of human capital can be applied to a broad range of human behavior and decisions, such as why we get married, why we start a family, and why we go to university, I became very excited and inspired, to the point of getting goosebumps.

Prof. Becker's theory goes beyond the scope of economics and makes all aspects of human behavior explainable, leading to discoveries and recommendations that will change real society, including education, human resource development, discrimination, fertility, and the division of labor within the family. I was fascinated by this and approached him to become my supervisor. Professor Becker first asked for my transcripts and resume, and called me in for an interview. I still remember my hands sweating and being very nervous. Fortunately, the interview went smoothly, and I was accepted as his student. After obtaining my master's degree, I returned to NRI, but my desire to become a scholar was ignited, so I returned to graduate school with my own money and a scholarship from the University of Chicago and completed my doctoral course. I left NRI on good terms, completed my Ph.D. at Chicago, and began my career as a scholar.

What Makes Happiness Studies So Intellectually Stimulating Is That It Challenges Economic Assumptions

Let me touch upon my other research theme, happiness studies.

As I mentioned earlier, I use statistical data to discover what makes people happy from sociological and economic perspectives. In a study published in 2016, my coauthor and I analyzed the determinants of happiness using data on 50,000 people from 30 countries around the world. Our analysis explored such themes as the relationship between money and happiness, between children and happiness, and between social welfare and happiness.

What is interesting about international comparisons of happiness is cultural bias. For example, Japan is in a good position in terms of macro-economic indicators such as GDP, unemployment, and inequality. But for some reason, overall happiness is low. On the other hand, countries such as Brazil and Nigeria have low GDP and high inequality, but the people are relatively happy.

The former people are rather humble. Even if objective macro indicators are good, they may be in self-denial and respond, “I can't say I'm happy...” On the other hand, the latter view their own lives positively and may express this honestly, regardless of the actual social and economic conditions. This difference in culture and national character seems to be a cultural bias that is reflected in the survey results. If this is the case, however, we need to reconsider the very idea of measuring happiness using statistics.

In 1974, American economist Richard Easterlin proposed the Easterlin Paradox, which states that once GDP and income exceed a certain level, people's subjective happiness and well-being stop increasing. Being economically wealthy and being subjectively well-off are not the same thing. This research that undermined the assumptions of economics was published more than 40 years ago.

If so, does it make sense for countries to continue its pursuit of economic growth? Why are countries trying to expand GDP in the first place? These are difficult questions, as is cultural bias. But I am actually inspired by them because they are intellectually stimulating.

Without Theory, Business Cases Cannot Be Analyzed Well – That Is My Belief After Studying Under Prof. Becker

Prof. Becker applied human capital theory to a wide range of economic and social activity, and made recommendations that have an impact on real society. I learned this approach at the University of Chicago, and so my approach is to first analyze cases based on theory as well. My belief is that “without theory, a case cannot be analyzed well. I hold this belief even now as I teach MBAs at the business school.

We think about theory with greater depth, so we don't forget it easily. Students have responded positively, saying, “Prof. Ono's classes are theory-based, so they really stick in my head.”

I hope my students will spend time thinking deeply about theory, just like I did when I was at NRI, locking myself away in a research institute in Kamakura and immersing myself in analysis while looking out at Sagami Bay.