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Technical Progress and the Growth of the Japanese Economy--Past and Future

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  • Yoshikawa, Hiroshi

Abstract

This paper considers technical progress and the growth of the Japanese economy. Many economists are pessimistic about the economy's future because of the rapid ageing of the population. However, capital and total factor productivity (TFP) are much more important than labour in determining economic growth. During the high-growth era of the 1950s and 1960s, TFP contributed almost 4 percentage points to the 10 per cent annual growth rate. Since then, however, TFP growth has fallen significantly. During the 1970s, Japan's machinery industries became world leaders and made possible the export-led growth of the period 1975-85. I argue that the stagnation of the 1990s was caused by demand deficiency, and that demand creation by technical progress is the key to economic growth. Copyright 2000 by Oxford University Press.

Suggested Citation

  • Yoshikawa, Hiroshi, 2000. "Technical Progress and the Growth of the Japanese Economy--Past and Future," Oxford Review of Economic Policy, Oxford University Press, vol. 16(2), pages 34-45, Summer.
  • Handle: RePEc:oup:oxford:v:16:y:2000:i:2:p:34-45
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    Cited by:

    1. Kalim Siddiqui, 2015. "Political Economy Of Japan’S Decades Long Economic Stagnation," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 10(4), pages 9-39, December.
    2. Tim Callen & Warwick J. McKibbin, 2001. "Policies and Prospects in Japan and the Implications for the Asia-Pacific Region," IMF Working Papers 01/131, International Monetary Fund.
    3. Adam S. Posen, 2001. "Unchanging Innovation and Changing Economic Performance in Japan," Working Paper Series WP01-5, Peterson Institute for International Economics.
    4. repec:spr:joevec:v:27:y:2017:i:3:d:10.1007_s00191-017-0498-4 is not listed on IDEAS
    5. Kawamoto, Takuji, 2005. "What Do the Purified Solow Residuals Tell Us about Japan's Lost Decade?," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 23(1), pages 113-148, February.

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