IDEAS home Printed from https://ideas.repec.org/a/ebl/ecbull/eb-07c60004.html
   My bibliography  Save this article

Population ageing, policy reforms and economic growth in Japan: a computable OLG model with endogenous growth mechanism

Author

Listed:
  • Manabu Shimasawa

    (Akita University)

Abstract

We have developed a computable endogenous growth OLG model generated by the accumulation of human capital. To study whether policy reform against aging make any quantitative impacts through human capital formation on the Japanese economy and whether it has long-run effect, we simulate two policy change scenarios and compare the results of those with endogenous growth to those with exogenous growth. The results are very encouraging: (i) policy changes promote human capital accumulation and thus accelerate economic growth. (ii) they have positive effects in the long run. Moreover, the traditional exogenous growth OLG model underestimates the effect of policy reform.

Suggested Citation

  • Manabu Shimasawa, 2007. "Population ageing, policy reforms and economic growth in Japan: a computable OLG model with endogenous growth mechanism," Economics Bulletin, AccessEcon, vol. 3(49), pages 1-11.
    • Handle: RePEc:ebl:ecbull:eb-07c60004
    as

    Download full text from publisher

    File URL: http://www.accessecon.com/pubs/EB/2007/Volume3/EB-07C60004A.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Bouzahzah, Mohamed & De la Croix, David & Docquier, Frederic, 2002. "Policy reforms and growth in computable OLG economies," Journal of Economic Dynamics and Control, Elsevier, vol. 26(12), pages 2093-2113, October.
    3. Fougere, Maxime & Merette, Marcel, 1999. "Population ageing and economic growth in seven OECD countries," Economic Modelling, Elsevier, vol. 16(3), pages 411-427, August.
    4. Rebelo, Sergio, 1991. "Long-Run Policy Analysis and Long-Run Growth," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 500-521, June.
    5. Sadahiro, Akira & Shimasawa, Manabu, 2003. "The computable overlapping generations model with an endogenous growth mechanism," Economic Modelling, Elsevier, vol. 20(1), pages 1-24, January.
    6. Kato, Ryuta Ray, 2002. "Government Deficit, Public Investment, and Public Capital in the Transition to an Aging Japan," Journal of the Japanese and International Economies, Elsevier, vol. 16(4), pages 462-491, December.
    7. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Choi, Ki-Hong & Shin, Sungwhee, 2015. "Population aging, economic growth, and the social transmission of human capital: An analysis with an overlapping generations model," Economic Modelling, Elsevier, vol. 50(C), pages 138-147.
    2. Yuan-Ho Hsu & Hiroshi Yoshida & Fengming Chen, 2022. "The Impacts of Population Aging on China’s Economy," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 14(1), pages 105-130, January.
    3. Zheng Guo & Linchen Liu & Xuan Liu, 2016. "Population Aging, Marginal Propensity to Consume, and Economic Growth," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 6(9), pages 534-546, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. SHIMASAWA Manabu, 2004. "Population ageing policy reforms and endogenous growth in Japan: a computable overlapping generations approach," ESRI Discussion paper series 096, Economic and Social Research Institute (ESRI).
    2. Magnani, Riccardo, 2011. "A general equilibrium evaluation of the sustainability of the new pension reforms in Italy," Research in Economics, Elsevier, vol. 65(1), pages 5-35, March.
    3. SHIMASAWA Manabu & HOSOYAMA Hidetoshi, 2004. "Economic Implications Of An Aging Population: The Case Of Five Asian Economies," ESRI Discussion paper series 117, Economic and Social Research Institute (ESRI).
    4. Sadahiro, Akira & Shimasawa, Manabu, 2003. "The computable overlapping generations model with an endogenous growth mechanism," Economic Modelling, Elsevier, vol. 20(1), pages 1-24, January.
    5. Shindo, Yuko, 2010. "The effect of education subsidies on regional economic growth and disparities in China," Economic Modelling, Elsevier, vol. 27(5), pages 1061-1068, September.
    6. Rao, B. Bhaskara, 2010. "Estimates of the steady state growth rates for selected Asian countries with an extended Solow model," Economic Modelling, Elsevier, vol. 27(1), pages 46-53, January.
    7. Jung-Suk Yu & M. Kabir Hassan & Abdullah Mamun & Abul Hassan, 2014. "Financial Sectors Reform and Economic Growth in Morocco: An Empirical Analysis," Journal of Emerging Market Finance, Institute for Financial Management and Research, vol. 13(1), pages 69-102, April.
    8. Prof. Dr. Adem KALCA & Resc. Assist. Atakan DURMAZ, 2012. "Diaspora As The Instrument Of Humane Capital," International Journal of Business and Social Research, LAR Center Press, vol. 2(5), pages 94-104, October.
    9. Iamsiraroj, Sasi, 2016. "The foreign direct investment–economic growth nexus," International Review of Economics & Finance, Elsevier, vol. 42(C), pages 116-133.
    10. Schreiner, Lena & Madlener, Reinhard, 2022. "Investing in power grid infrastructure as a flexibility option: A DSGE assessment for Germany," Energy Economics, Elsevier, vol. 107(C).
    11. Antonio Ciccone & Giovanni Peri & Douglas Almond, "undated". "Capital, Wages, and Growth: Theory and Evidence," Working Papers 152, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    12. Carine Nourry, 2012. "Dasgupta, D.: Modern growth theory," Journal of Economics, Springer, vol. 105(1), pages 97-100, January.
    13. Zeng, Jinli & Zhang, Jie, 2022. "Education policies and development with threshold human capital externalities," Economic Modelling, Elsevier, vol. 108(C).
    14. V. V. Chari & Patrick J. Kehoe & Ellen R. McGrattan, 1996. "The Poverty of Nations: A Quantitative Exploration," NBER Working Papers 5414, National Bureau of Economic Research, Inc.
    15. Wilson, E.J. & Chaudhri, D.P., 2000. "Endogeneity, Knowledge and Dynamics of Long Run Capitalist Economic Growth," Economics Working Papers wp00-03, School of Economics, University of Wollongong, NSW, Australia.
    16. Matthias Firgo & Peter Mayerhofer, 2015. "Wissens-Spillovers und regionale Entwicklung - welche strukturpolitische Ausrichtung optimiert des Wachstum?," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 144, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    17. Smulders, Sjak & Gradus, Raymond, 1996. "Pollution abatement and long-term growth," European Journal of Political Economy, Elsevier, vol. 12(3), pages 505-532, November.
    18. Paulo B. Brito, 2022. "The dynamics of growth and distribution in a spatially heterogeneous world," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 21(3), pages 311-350, September.
    19. Sushil Kumar Haldar, 2009. "Economic Growth in India Revisited," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 10(1), pages 105-126, January.
    20. David Gould & Roy Ruffin, 1995. "Human capital, trade, and economic growth," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 131(3), pages 425-445, September.

    More about this item

    JEL classification:

    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • J1 - Labor and Demographic Economics - - Demographic Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-07c60004. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: John P. Conley (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.