On Sustainability of Selective Macroeconomic Problems

To date, there have been investigations in theory and in empirics in Japan on the sustainability of such problems as accumulated government deficits, public pension system in face of the declining birthrate and rapidly aging population, and speculative bubbles of land and stock prices, from rather negative, pessimistic viewpoints. In addition to these, rising concerns are directed toward the coexistence of economic development and sustaining natural environment as envisaged by endangered crises of diminishing biodiversity, drier and expanding deserts, global warming and sea surface elevation, and so on. It was the sustainable development goals or SDGs, which all the members of the United Nations (then 193 countries) unanimously adopted in 2015 in foreseeing the target year 2030, that have clarified what ought to be the desired future state of world and stimulated preferentially worldwide, global strategic actions to pursue the sustainable economic and social development as individually familiar issues. Then as extensions or applications of SDGs, quite new sustainable goals such that the sustainable local economy, sustainable firm management, sustainable neighborhood relations and the like have arisen and been occasionally referred to even over people’s daily conversations. Looking around the globalized international economies, many national economies nowadays confront simultaneously with common difficulties of global warming, acid rains, marine plastic pollution, and so on which basically were drastically worsened by the economic development of once underdeveloped national economies, although these global environmental issues were incipiently generated and accumulated through earlier development of now industrialized economies. The new coronavirus (COVID-19) pandemic that had spread, registering several waves, globally through 2020-23 brought about in a short time large recessions in a number of national economies that were comparable with the United States Great Depression of the 1930s, or in some nations worse than USGD statistics. This pandemic experience newly reminds us of the fact that national economies are interrelated and simultaneously face common crises and cooperate against such crises, which leads us to the awareness that global interconnectedness and co-movement indicates that the sustainability of individual national economies should also ask as a whole the sustainability of the global economy. I organized, as an editor in The Financial Review No. 150 published in Japanese in 2023, a special issue on the sustainability of selective macroeconomic problems. The following papers in this issue, papers in this Public Policy Review (PPR), reorganize compactly the original contributions. My introductory paper, Asako (2023), overviews four macroeconomic problems whose sustainability is questioned and examines their mutual interconnections. More concretely, as those relevant to the national economies, we investigate both theoretically and empirically accumulated government deficits, the public pension system as a going concern, booms and busts of speculative bubbles of land and stock prices, and as those relevant to the global economy that is beyond national economies the convergence to some sustainable steady state under environmental external diseconomy.