Can IT be Japan's Savior?
AbstractThis paper constructs a multi-sector model to take explicit account of the very sharp change in the relative price between non-IT and IT goods. The model is calibrated to the Japanese economy, and its solution path from 1990 on is compared to Japan's macroeconomic performance in the 1990s. Compared to the one-sector analysis of Japan in the 1990s in Hayashi and Prescott (2002), our model does slightly better or just as well in accounting for Japan's output slump and does worse in accounting for the capital-output ratio. We also show that, to revive a 2% long-term growth in percapita GDP, Japan needs to direct 10% of private total hours to the IT sector.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 11749.
Date of creation: Nov 2005
Date of revision:
Publication status: published as Hayashi, Fumio and Koji Nomura. "Can IT Be Japan's Savior?," Journal of the Japanese and International Economies, 2005, v19(4,Dec), 543-567.
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Other versions of this item:
- Hayashi, Fumio & Nomura, Koji, 2005. "Can IT be Japan's savior?," Journal of the Japanese and International Economies, Elsevier, vol. 19(4), pages 543-567, December.
- E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
- O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
- O5 - Economic Development, Technological Change, and Growth - - Economywide Country Studies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-11-12 (All new papers)
- NEP-CSE-2005-11-12 (Economics of Strategic Management)
- NEP-MAC-2005-11-12 (Macroeconomics)
- NEP-SEA-2005-11-12 (South East Asia)
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- Jorgenson, Dale W. & Nomura, Koji, 2005.
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Journal of the Japanese and International Economies,
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