IDEAS home Printed from https://ideas.repec.org/p/eti/dpaper/05022.html

Productivity and the Business Cycle in Japan -Evidence from Japanese Industry Data -

Author

Listed:
  • Tsutomu Miyagawa
  • Yukie Sakuragawa
  • Miho Takizawa

Abstract

Constructing thirty-seven industries database, we examines whether measured productivity in Japan is procyclical and investigates the sources of that procyclicality using the production function approach employed by Hall (1990) and Basu and Fernald (1995). At the aggregate level, the measured Solow residual shows procyclicality. Large numbers of industries show constant returns to scale. No significant evidence for the presence of thick-market externalities is found. Our results also hold when we consider labor hoarding, part-time employment, and the adjustment cost of investment. The results suggest policies to revitalize the Japanese economy should concentrate on promoting productivity growth.

Suggested Citation

  • Tsutomu Miyagawa & Yukie Sakuragawa & Miho Takizawa, 2005. "Productivity and the Business Cycle in Japan -Evidence from Japanese Industry Data -," Discussion papers 05022, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:05022
    as

    Download full text from publisher

    File URL: https://www.rieti.go.jp/jp/publications/dp/05e022.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Miles S. Kimball & John G. Fernald & Susanto Basu, 2006. "Are Technology Improvements Contractionary?," American Economic Review, American Economic Association, vol. 96(5), pages 1418-1448, December.
    2. Naohito Abe, 2004. "The Multi‐Sector Business Cycle Model and Aggregate Shocks: An Empirical Analysis," The Japanese Economic Review, Japanese Economic Association, vol. 55(1), pages 101-118, March.
    3. Nakajima, Tomoyuki, 2005. "A business cycle model with variable capacity utilization and demand disturbances," European Economic Review, Elsevier, vol. 49(5), pages 1331-1360, July.
    4. Tom Krebs, 2003. "Growth and Welfare Effects of Business Cycles in Economies with Idiosyncratic Human Capital Risk," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 6(4), pages 846-868, October.
    5. repec:bla:econom:v:67:y:2000:i:266:p:229-44 is not listed on IDEAS
    6. Burnside, Craig, 1996. "Production function regressions, returns to scale, and externalities," Journal of Monetary Economics, Elsevier, vol. 37(2-3), pages 177-201, April.
    7. Harald Uhlig & Lars Ljungqvist, 2000. "Tax Policy and Aggregate Demand Management under Catching Up with the Joneses," American Economic Review, American Economic Association, vol. 90(3), pages 356-366, June.
    8. Shigeru Wakita, 1997. "Chronic Labour Hoarding: Direct Evidence from Japan," The Japanese Economic Review, Japanese Economic Association, vol. 48(3), pages 307-323, September.
    9. Burnside, Craig & Eichenbaum, Martin & Rebelo, Sergio, 1993. "Labor Hoarding and the Business Cycle," Journal of Political Economy, University of Chicago Press, vol. 101(2), pages 245-273, April.
    10. Kyoji Fukao & Hyeog Ug Kwon, 2006. "Why Did Japan'S Tfp Growth Slow Down In The Lost Decade? An Empirical Analysis Based On Firm‐Level Data Of Manufacturing Firms," The Japanese Economic Review, Japanese Economic Association, vol. 57(2), pages 195-228, June.
    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. Masayuki Morikawa, 2011. "Economies of Density and Productivity in Service Industries: An Analysis of Personal Service Industries Based on Establishment-Level Data," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 179-192, February.
    2. NAKAJIMA Takanobu, 2007. "Is Retail Service Productivity Really Low in Japan? -- Numerical experiment based on Shepard's model --," ESRI Discussion paper series 193, Economic and Social Research Institute (ESRI).
    3. Joseph Junior Aduba & Behrooz Asgari, 2020. "Productivity and technological progress of the Japanese manufacturing industries, 2000–2014: estimation with data envelopment analysis and log-linear learning model," Asia-Pacific Journal of Regional Science, Springer, vol. 4(2), pages 343-387, June.

    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. Marchetti, Domenico J. & Nucci, Francesco, 2005. "Price stickiness and the contractionary effect of technology shocks," European Economic Review, Elsevier, vol. 49(5), pages 1137-1163, July.
    2. Domenico J. Marchetti & Francesco Nucci, 2007. "Pricing Behavior and the Response of Hours to Productivity Shocks," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 39(7), pages 1587-1611, October.
    3. Ko, Jun-Hyung & Kwon, Hyeog Ug, 2015. "Do technology shocks lower hours worked? – Evidence from Japanese industry level data," Journal of Macroeconomics, Elsevier, vol. 44(C), pages 138-157.
    4. Evans, Charles L. & Marshall, David A., 2007. "Economic determinants of the nominal treasury yield curve," Journal of Monetary Economics, Elsevier, vol. 54(7), pages 1986-2003, October.
    5. Rahman, Pk. Md. Motiur & Yamagata, Tatsufumi, 2004. "Business Cycles and Seasonal Cycles in Bangladesh," IDE Discussion Papers 1, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    6. Luca Benati, 2001. "Band-pass filtering, cointegration, and business cycle analysis," Bank of England working papers 142, Bank of England.
    7. Balke, Nathan S. & Wynne, Mark A., 2000. "An equilibrium analysis of relative price changes and aggregate inflation," Journal of Monetary Economics, Elsevier, vol. 45(2), pages 269-292, April.
    8. Been-lon Chen & Yu-shan Hsu, 2009. "Is admiration a source of indeterminacy when the speed of habit formation is finite?," Economics Bulletin, AccessEcon, vol. 29(4), pages 3041-3049.
    9. Hussain, Syed M. & Malik, Samreen, 2016. "Asymmetric Effects of Exogenous Tax Changes," Journal of Economic Dynamics and Control, Elsevier, vol. 69(C), pages 268-300.
    10. Ethan Ilzetzki, 2024. "Learning by Necessity: Government Demand, Capacity Constraints, and Productivity Growth," American Economic Review, American Economic Association, vol. 114(8), pages 2436-2471, August.
    11. Jordi Galí & Thijs van Rens, 2021. "The Vanishing Procyclicality of Labour Productivity [Why have business cycle fluctuations become less volatile?]," The Economic Journal, Royal Economic Society, vol. 131(633), pages 302-326.
    12. M. Ali Choudhary & Vasco J. Gabriel, 2006. "Mind the Gap: A Comment on Aggregate Productivity and Technology," School of Economics Discussion Papers 1306, School of Economics, University of Surrey.
    13. Stephanie Schmitt-Grohe, 2000. "Endogenous Business Cycles and the Dynamics of Output, Hours, and Consumption," American Economic Review, American Economic Association, vol. 90(5), pages 1136-1159, December.
    14. Mumtaz Ahmad & John Fernald & Hashmat Khan, 2019. "Returns to Scale in U.S. Production, Redux," Carleton Economic Papers 19-07, Carleton University, Department of Economics.
    15. Susanto Basu & John Fernald, 2001. "Why Is Productivity Procyclical? Why Do We Care?," NBER Chapters, in: New Developments in Productivity Analysis, pages 225-302, National Bureau of Economic Research, Inc.
    16. Sergio Rebelo, 2005. "Real Business Cycle Models: Past, Present, and Future," NBER Working Papers 11401, National Bureau of Economic Research, Inc.
    17. Brand, Claus & Obstbaum, Meri & Coenen, Günter & Sondermann, David & Lydon, Reamonn & Ajevskis, Viktors & Hammermann, Felix & Angino, Siria & Hernborg, Nils & Basso, Henrique & Hertweck, Matthias & Bi, 2021. "Employment and the conduct of monetary policy in the euro area," Occasional Paper Series 275, European Central Bank.
    18. Altug, S. & Filiztekin, A., 1997. "Estimates of the Returns to Scale for US Manufacturing," Papers 1997/24, Koc University.
    19. Jim Malley & Anton Muscatelli & Ulrich Woitek, 1999. "Real Business Cycles or Sticky Prices? The Impact of Technology Shocks on US Manufacturing," Working Papers 1999_15, Business School - Economics, University of Glasgow.
    20. Mitra, Aruni, 2024. "The productivity puzzle and the decline of unions," Journal of Economic Dynamics and Control, Elsevier, vol. 159(C).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:eti:dpaper:05022. 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: TANIMOTO, Toko (email available below). General contact details of provider: https://edirc.repec.org/data/rietijp.html .

    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.