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Quantity or Quality: The Impact of Labor-Saving Innovation on US and Japanese Growth Rates, 1960-2004


  • Ryuzo Sato

    (The Center for Japan-US Business and Economic Studies, New York University and Faculty of Economis, University of Tokyo)

  • Tamaki Morita

    (National Graduate Institute for Policy Studies)


This article deals with both theoretical and empirical analyses of the post-war period (1960-2004) for the United States and Japan. We investigated three factors contributing to growth: the growth rates of capital, labor, and labor-saving innovation. It is shown that in Japan, the growth rate of the labor force has been much less important than its quality improvement-i.e., labor-saving technical change-while in the US, the growth rate of labor and population has contributed more than their quality improvement. The policy implication here is Japan's declining population can be compensated for by additional quality improvement of the existing labor force.

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  • Ryuzo Sato & Tamaki Morita, 2007. "Quantity or Quality: The Impact of Labor-Saving Innovation on US and Japanese Growth Rates, 1960-2004," CIRJE F-Series CIRJE-F-483, CIRJE, Faculty of Economics, University of Tokyo.
  • Handle: RePEc:tky:fseres:2007cf483

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    References listed on IDEAS

    1. Basu, Susanto & Fernald, John G., 2002. "Aggregate productivity and aggregate technology," European Economic Review, Elsevier, vol. 46(6), pages 963-991, June.
    2. 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.
    3. Sato, Ryuzo & Ramachandran, Rama, 1987. "Factor Price Variation and the Hicksian Hypothesis: A Microeconomic Model," Oxford Economic Papers, Oxford University Press, vol. 39(2), pages 343-356, June.
    4. Jorgenson, Dale W. & Motohashi, Kazuyuki, 2005. "Information technology and the Japanese economy," Journal of the Japanese and International Economies, Elsevier, vol. 19(4), pages 460-481, December.
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