On the Role of Policy Interventions in Structural Change and Economic Development: The Case of Postwar Japan
AbstractIn this paper, we study the structural change occurring in Japan's post-World War II era of rapid economic growth. We use a two-sector neoclassical growth model with government policies to analyze the evolution of the Japanese economy in this period and to assess the role of such policies. Our model is able to replicate the empirical behavior of the main macroeconomic variables. Three findings emerge from our policy analysis. First, neither price and investment subsidies to the agricultural sector, nor industrial policy play a crucial role in the rapid postwar growth. Second, while a government subsidy for families in urban areas could have facilitated migration from the agricultural to the non-agricultural sector, such a policy would not have improved the overall performance of the Japanese economy. Finally, had there existed a labor migration barrier, the negative long-run level effect on output would have been substantial.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 09001.
Length: 28 pages
Date of creation: Jan 2009
Date of revision:
Contact details of provider:
Postal: 11th floor, Annex, Ministry of Economy, Trade and Industry (METI) 1-3-1, Kasumigaseki Chiyoda-ku, Tokyo, 100-8901
Web page: http://www.rieti.go.jp/
More information through EDIRC
This paper has been announced in the following NEP Reports:
- NEP-AGR-2009-01-17 (Agricultural Economics)
- NEP-ALL-2009-01-17 (All new papers)
- NEP-DEV-2009-01-17 (Development)
- NEP-FDG-2009-01-17 (Financial Development & Growth)
- NEP-HIS-2009-01-17 (Business, Economic & Financial History)
- NEP-MAC-2009-01-17 (Macroeconomics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Romer, Paul M, 1990.
"Endogenous Technological Change,"
Journal of Political Economy,
University of Chicago Press, vol. 98(5), pages S71-102, October.
- Rustichini, Aldo & Schmilz, James Jr., 1991. "Research and imitation in long-run growth," Journal of Monetary Economics, Elsevier, vol. 27(2), pages 271-292, April.
- repec:fth:stanho:e-92-3 is not listed on IDEAS
- Gollin, Douglas & Parente, Stephen L. & Rogerson, Richard, 2007.
"The food problem and the evolution of international income levels,"
Journal of Monetary Economics,
Elsevier, vol. 54(4), pages 1230-1255, May.
- Douglas Gollin & Stephen L. Parente & Richard Rogerson, 2004. "The Food Problem and the Evolution of International Income Levels," Working Papers 899, Economic Growth Center, Yale University.
- Matsuyama, Kiminori, 1992.
"Agricultural productivity, comparative advantage, and economic growth,"
Journal of Economic Theory,
Elsevier, vol. 58(2), pages 317-334, December.
- Kiminori Matsuyama, 1990. "Agricultural Productivity, Comparative Advantage, and Economic Growth," Discussion Papers 934, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Kiminori Matsuyama, 1991. "Agricultural Productivity, Comparative Advantage and Economic Growth," NBER Working Papers 3606, National Bureau of Economic Research, Inc.
- Fumio Hayashi & Edward C. Prescott, 2008.
"The Depressing Effect of Agricultural Institutions on the Prewar Japanese Economy,"
Journal of Political Economy,
University of Chicago Press, vol. 116(4), pages 573-632, 08.
- Fumio Hayashi & Edward C. Prescott, 2006. "The Depressing Effect of Agricultural Institutions on the Prewar Japanese Economy," NBER Working Papers 12081, National Bureau of Economic Research, Inc.
- Enrique G. Mendoza & Assaf Razin & Linda L. Tesar, 1995.
"Effective Tax Rates in Macroeconomics: Cross-Country Estimates of Tax Rates on Factor Incomes and Consumption,"
NBER Working Papers
4864, National Bureau of Economic Research, Inc.
- Mendoza, Enrique G. & Razin, Assaf & Tesar, Linda L., 1994. "Effective tax rates in macroeconomics: Cross-country estimates of tax rates on factor incomes and consumption," Journal of Monetary Economics, Elsevier, vol. 34(3), pages 297-323, December.
- "Minami, Ryoshin", 1968. "The Turning Point in the Japanese Economy," Economic Review, Hitotsubashi University, vol. 19(3), pages 220-229, July.
- Lee, Hiro, 1993. "General equilibrium evaluation of industrial policy in Japan," Journal of Asian Economics, Elsevier, vol. 4(1), pages 25-40.
- Laitner, John, 2000. "Structural Change and Economic Growth," Review of Economic Studies, Wiley Blackwell, vol. 67(3), pages 545-61, July.
- Hayami, The late Yujiro & Godo, Yoshihisa, 2005. "Development Economics: From the Poverty to the Wealth of Nations," OUP Catalogue, Oxford University Press, edition 3, number 9780199272716.
- repec:fip:fedfap:2003-02 is not listed on IDEAS
- Fumio Hayashi & Edward C. Prescott, 2002.
"Data Appendix to The 1990s in Japan: A Lost Decade,"
hayashi02, Review of Economic Dynamics.
- Yoshiro Miwa & J. Mark Ramseyer, 2004. "Directed Credit? The Loan Market in High-Growth Japan," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 13(1), pages 171-205, 03.
- Solow, Robert M., 2005. "Reflections on Growth Theory," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 0, pages 3-10 Elsevier.
- Fumio Hayashi & Edward C. Prescott, 2000.
"The 1990s in Japan: a lost decade,"
607, Federal Reserve Bank of Minneapolis.
- Benhabib, Jess & Spiegel, Mark M., 2005.
"Human Capital and Technology Diffusion,"
Handbook of Economic Growth,
in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 13, pages 935-966
- Beason, R. & Weinstein, D.E., 1993.
"Growth, Economies of Scale, and Targeting in Japan (1955- 1990),"
Harvard Institute of Economic Research Working Papers
1644, Harvard - Institute of Economic Research.
- Beason, Richard & Weinstein, David E, 1996. "Growth, Economies of Scale, and Targeting in Japan (1955-1990)," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 286-95, May.
- Keijiro Otsuka, 2006. "Cluster-Based Industrial Development: A View From East Asia," The Japanese Economic Review, Japanese Economic Association, vol. 57(3), pages 361-376.
- Restuccia, Diego & Yang, Dennis Tao & Zhu, Xiaodong, 2008.
"Agriculture and aggregate productivity: A quantitative cross-country analysis,"
Journal of Monetary Economics,
Elsevier, vol. 55(2), pages 234-250, March.
- Diego Restuccia & Dennis Tao Yang & Xiaodong Zhu, 2007. "Agriculture and Aggregate Productivity: A Quantitative Cross-Country Analysis," Working Papers e07-3, Virginia Polytechnic Institute and State University, Department of Economics.
- Diego Restuccia & Dennis Tao Yang & Xiaodong Zhu, 2003. "Agriculture and Aggregate Productivity: A Quantitative Cross-Country Analysis," Working Papers diegor-03-01, University of Toronto, Department of Economics.
- Eswaran, Mukesh & Kotwal, Ashok, 1993. "A theory of real wage growth in LDCs," Journal of Development Economics, Elsevier, vol. 42(2), pages 243-269, December.
- Aoki, Shuhei, 2011.
"A Model of Technology Transfer in Japan's Rapid Economic Growth Period,"
IIR Working Paper
11-05, Institute of Innovation Research, Hitotsubashi University.
- Aoki, Shuhei, 2011. "A Model of Technology Transfer in Japan's Rapid Economic Growth Period," MPRA Paper 29235, University Library of Munich, Germany.
- Naohisa Hirakata & Takeki Sunakawa, 2013. "Financial Frictions, Capital Misallocation, and Structural Change," IMES Discussion Paper Series 13-E-06, Institute for Monetary and Economic Studies, Bank of Japan.
- MIYAZAWA Kensuke, 2011. "Measuring Human Capital in Japan," Discussion papers 11037, Research Institute of Economy, Trade and Industry (RIETI).
- Aoki, Shuhei, 2012.
"A simple accounting framework for the effect of resource misallocation on aggregate productivity,"
Journal of the Japanese and International Economies,
Elsevier, vol. 26(4), pages 473-494.
- Aoki, Shuhei, 2008. "A Simple Accounting Framework for the Effect of Resource Misallocation on Aggregate Productivity," MPRA Paper 11511, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (NUKATANI Sorahiko).
If references are entirely missing, you can add them using this form.