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Information and Communication Technology (ICT) might be able to substitute for young workers in Japan. This suggests ICT innovation may reduce the effects of aging on the Japanese economy. We also found a complementary relationship between ICT capital and high education workers. The importance of older worker's skills declined from the 1980s to the 1990s. One of the cornerstones of Japan's aging industry--long-term work relationships with extensive and specialized on-the-job training--therefore became less important. Furthermore, on the negative side, we also found that outsourcing in the ICT service industry (including software and Internet) has been rather inefficient in Japan. [ABSTRACT FROM AUTHOR]

Over the last ten years, Japan and Germany--two post-war industrial superpowers--have fallen substantially behind their common rival, the United States. These two economies are now seen as major contributors to slowing down the global economy. This paper aims to examine the causes of the abrupt weakening of the manufacturing sector of Japan, particularly in the information and communication technology (ICT) industry, while comparing their performances with those of the United States and Germany. [ABSTRACT FROM AUTHOR]

This study estimates and conducts a factor analysis on Okun's coefficient to look at the labor productivity effect that can be derived from the Okun coefficient residual, and indirectly examines the employment adjustment speed of the Japanese economy in 1981-2010. The key findings are as follows. Okun's coefficient for the Japanese economy was calculated at 10.8 for the periods 1981-2000 and 2008-10, and 3.0 for the period 2001-7 (= 1 ÷ 0.329), with the value of Okun's coefficient falling in the 2001-7 period, but then rebounding to its original value in 2008 and after. The labor productivity effect was found by calculating the difference remaining after subtracting the direct effect, labor supply effect, and labor hours effect from Okun's coefficient. It was 6.43 in the periods 1981-2000 and 2008-10, and 1.03 in the period 2001-7 when Okun's coefficient fell. This means that corporate employment hoarding had decreased, indirectly showing that employment adjustments had been made quickly. In the period 2008-10, following the collapse of Lehman Brothers, Okun's coefficient rebounded to 10.8 and the labor productivity effect returned to its previous level, thus suggesting that the overemployment being maintained by companies was largely eliminated in the 2001-7 period. It was not so much that the pace of employment adjustment itself changed after the collapse of Lehman Brothers, but rather that the magnitude of the Lehman collapse was so large as to require massive employment adjustments to be made even at the previous pace of employment adjustment. [ABSTRACT FROM AUTHOR]

This article surveys empirical analysis in Japan regarding labor supply, keeping in mind the policy assertion that "reducing taxes will vitalize the economy." The following two points characterize empirical analysis in Japan. First, there has been no comprehensive estimation done on the labor supply of prime working-age males who make up the core labor force, and no empirical analysis exists that could support the basis of the policy assertion. Second, although many empirical analyses exist regarding elderly and female labor, they are based on inappropriate specifications, and, even using such estimates, the effects of the tax system on labor supply cannot be identified. Therefore, an appropriate empirical analysis regarding the proposition "reducing taxes will vitalize the economy" has not been conducted, and with respect to core male labor, no real empirical analysis has been done. [ABSTRACT FROM AUTHOR]

In this chapter, first we point out the reasons that led to the unsustainable level of Japanese gross public debt. Then, we focus on the power struggles between domestic policymakers, bureaucrats, and businessmen in order to understand why it is difficult to reach quick decisions in Japanese political and economic affairs nowadays. After stressing the recent reform of home administration, we examine the reasons that led to the deregulation waves in the domestic banking industry and that finally resulted in the Big Bang of 1996. We also talk about the problem of the privatization of the state-owned postal savings system, because the latter seems to contain the solution to the structural impediments of domestic banking and policy-making bottlenecks. Furthermore, we discuss the shortcomings of the Japanese education and research systems. Then we mention the time bomb looming in the domestic pension and social security system that is deeply linked to the shortcomings of the domestic labor market and its decade-old hiring and promotion practices. Finally, we point to a very important issue on the labor market, namely, the declining work morale of domestic youth. [ABSTRACT FROM AUTHOR]

Chapter 4 of the book "The Japanese Economy" is presented. It examines the methods of calculating the size of the underground economy in Japan and the results of those calculations. Tax evasion, illegal income of the boryokudan, illegal income from the sex industry, illegal income from theft and illegal income from illicit gambling are the underground economic activities whose value will be estimated.

Chapter 2 of the book "The Japanese Economy" is presented. It explores the various realities of Japan's underground economy. Tax evasion by politicians who take bribes and under-the-table contributions is another important building block of the underground economy. Japan scored a 7.1 corruption perceptions index, ranking it twenty-first among the ninety-one countries examined and showing that it is not viewed as one of the cleaner of the developed nations.

Ever since Japan adopted the Basel capital adequacy standards, questions have been raised about the extent of its compliance. This article explains the political dynamics that have led to deviation from those standards in Japan. Scholars have posited various models of compliance—from mechanisms operating at the international level (for example, international institutions, the power of major countries, and market discipline) to domestic mechanisms such as the single-seat constituency system, which is presumed to create a political base supporting prudential regulation. By empirically examining the level of Japanese conformity with the Basel standards, however, this article demonstrates that mechanisms expected to foster compliance were not operating in the 1990s. Rather, amid the financial disorder created by the dysfunction of various domestic institutions, the postponement of efforts to resolve the nonperforming loan (NPL) problem not only hindered substantive compliance with the Basel Standards, but also led to further noncompliance by inviting the intervention of politicians, who tend to regard prudential regulation as a lesser priority, into the policymaking process for bank regulation. [ABSTRACT FROM AUTHOR]

By focusing on the changes that were taking place in the political environment the 1990s, this article tries to explain why Japan's fiscal condition deteriorated markedly during this decade. The analysis demonstrates that a substantial portion of the actual budget deficit can be understood as an appropriate reaction (tax smoothing) to the shocks that hit the economy during this period. However, it also suggests that the deficit was excessively large in comparison with the optimal level for tax smoothing, and that the deficit may have expanded due to noneconomic factors. A series of studies on the relationship between budget deficits and the political environment has shown that a shift to a coalition government and the weakening of a regime's political base may contribute to an increase in the budget deficit. A regression analysis examining the impact of political factors on Japan's ‘excess’ budget deficit show that the cabinet's approval rating and the share of seats in the Lower House of the Diet (parliament) held by the Liberal Democratic Party (LDP) are significantly and negatively correlated with that ‘excess’ deficit. These results suggest that the large deficit in the 1990s was partly due to the shift to a coalition government and the weakening of the LDP's power base. [ABSTRACT FROM AUTHOR]

Japan is in a structural crisis that has its roots in the preservation of a postwar model of stakeholder governance, and the maintenance of a "dual economy" between productive manufacturers in international competition and rather protected nonmanufacturing sectors. Comprehensive market reforms are necessary to solve these problems. Corporations clearly need more flexible labor and capital markets, competitively priced inputs, and the integration of high-grade outside skills. An analysis of adjusted total factor productivity (TFP) change rates shows that the manufacturing, utilities, transport, and communications sectors have strong growth potentials if they are able to cut their excessive use of capital and labor. The service sector, however, is not as productive as it should be (and this is even worse for the construction and real estate sectors). To establish the service industry not only as a pool for surplus labor, but also as an engine for growth for the entire economy, its production system clearly needs to undergo serious reform after market restrictions have been abolished and competition increased. [ABSTRACT FROM AUTHOR]

Presents a response to a comment on an article about the economic stagnation of Japan in the 1990s. Reason the Bank of Japan did not chose to create a recovery at any time since the early 1990s; Role of fiscal policy and interest rates in the economics of Japan; Comparison between quantitative easing and inflation targeting.

Comments on an article about the economic stagnation of Japan in the 1990s. Role of money in the stagnation of Japan in the 1990s; Definition of money; Reason the ability of Japanese banking system to create new credit weakened.

Examines the economic condition of Japan as of 2003. Description of the concept of deflation; Reason for the loss of confidence in the Japanese economy about the future; Socioeconomic conditions Japan need to be created for the public's confidence to be restored.

Discusses the employment of integrated production by Japanese firms in the East Asian region. Background on Japan's export promotion policy; Key policies that allowed Japan's economy to recover quickly after World War II; Effects of East Asian production networks on the Japanese economy.

Describes the responses of Japan to permeable insulation or the economic and global political challenges of the 21st century. Changes in the economic and global political condition of Japan; Emergence of permeable insulation; Consequences of permeability; Pressure for permeable insulation.