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How Uncertain Are Economic Policies? Evidence from a survey on Japanese firms

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  • MORIKAWA Masayuki

Abstract

This study, using data from an original survey covering both public and private firms in Japan, presents evidence on uncertainties over economic policies, their effects on managerial decisions, and firms' evaluations of the government's numerical targets related to economic policies. This study is an extension of Morikawa (2013), but the survey greatly expands its coverage including private firms and adds new questionnaires. The results indicate that Japanese firms perceive uncertainty over the future course of certain economic policies, such as the social security system, tax policy, fiscal expenditures, and international trade policy. Policy uncertainties have substantial effects on managerial decisions, especially on equipment investment and hiring of regular employees. Medium- to long-term numerical targets related to the government's economic policies are generally perceived to be difficult to achieve.

Suggested Citation

  • MORIKAWA Masayuki, 2016. "How Uncertain Are Economic Policies? Evidence from a survey on Japanese firms," Policy Discussion Papers 16008, Research Institute of Economy, Trade and Industry (RIETI).
  • Handle: RePEc:eti:polidp:16008
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    File URL: https://www.rieti.go.jp/jp/publications/pdp/16p008.pdf
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    References listed on IDEAS

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    6. Jackson, Kristoffer, 2016. "Do land use regulations stifle residential development? Evidence from California cities," Journal of Urban Economics, Elsevier, vol. 91(C), pages 45-56.
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    9. Sagiri Kitao, 2018. "Policy Uncertainty and Cost of Delaying Reform: The Case of Aging Japan," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 27, pages 81-100, January.
    10. Morikawa, Masayuki, 2016. "Business uncertainty and investment: Evidence from Japanese companies," Journal of Macroeconomics, Elsevier, vol. 49(C), pages 224-236.
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    13. Sinha, Arunima, 2016. "Monetary policy uncertainty and investor expectations," Journal of Macroeconomics, Elsevier, vol. 47(PB), pages 188-199.
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    Cited by:

    1. Keiichiro Kobayashi & Kozo Ueda, 2017. "Secular Stagnation and Low Interest Rates under the Fear of a Government Debt Crisis," CIGS Working Paper Series 17-012E, The Canon Institute for Global Studies.
    2. Elif C. Arbatli & Steven J. Davis & Arata Ito & Naoko Miake, 2017. "Policy Uncertainty In Japan," NBER Working Papers 23411, National Bureau of Economic Research, Inc.
    3. repec:eee:ecofin:v:45:y:2018:i:c:p:245-265 is not listed on IDEAS

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