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Paper short abstract

Why do some Japanese cities hire foreign nationals as public employees while others restrict nationality? We argue larger, wealthier cities mobilize mayoral entrepreneurship and interest groups. Analyzing 840 cities, we find fiscal strength and city size predict openness better than demographics.

Paper long abstract

Despite national government guidance reserving public sector positions involving the "exercise of public power" for citizens, Japanese municipalities exhibit striking variation in openness to hiring foreign residents. Why do some cities maintain strict nationality requirements while others have progressively expanded opportunities for foreign residents across administrative, technical, and specialized positions? This paper argues that policy innovation emerges from the strategic interaction between entrepreneurial mayors and organized interest groups. This dynamic is concentrated in larger, financially stronger cities.

Drawing on Schneider and Teske's (1992) political entrepreneurship framework, we theorize that mayors in larger cities possess advantages for challenging the status quo. Larger cities have more developed advocacy infrastructures, including organizations specifically mobilized around foreign resident rights. Operating most effectively in large cities, groups such as the Korean Residents Union in Japan (Mindan); the Tokyo Liaison Council for Realizing Foreign Resident Employment in Public Service; and the Japan Federation of Bar Associations have systematically campaigned to remove nationality restrictions. These interest groups can provide entrepreneurial mayors and local councils with important resources that enable change, including interest groups demonstrating political demand for reform, legal advice, and coalition partners. However, smaller municipalities do not benefit from such organizational infrastructure. As a result, mayors in these municipalities face higher costs and greater risks when considering change to the status quo.

Our framework further emphasizes how fiscal capacity enables entrepreneurial politics. Larger municipal budgets create "slack resources"—discretionary funds not committed to fixed obligations that political entrepreneurs can strategically reallocate toward policy experimentation, such as the hiring of foreign nationals. This fiscal flexibility, combined with dense interest group networks, allows entrepreneurial mayors to challenge restrictions on hiring foreign nationals without triggering conflicts over budget.

Analyzing 840 Japanese cities in 1997 and 2020 using ordered logit regression, we find that fiscal strength and city size significantly predict municipal openness while demographic factors show weaker relationships. These findings confirm previous studies that have demonstrated that local governments are important for progressive policy innovation in Japan. Entrepreneurial mayors partnering with organized advocacy movements can lead reforms that challenge assumptions about the role of foreign nationals in Japan.