"Improving Economic Statistics in order to Improve Economic Policy and Research: An Invitation" (in Japanese)

This paper identifies some of the principal problems in Japanese official economic statistics. It discusses how the government currently generates those numbers, and how it might begin to collect more helpful material. It invites researchers and members of the Japanese government to join in this effort to improve the collection of economic statistics. As an illustration, it compares the measurement of the total factor productivity growth index in Japan and the U.S. There is a which-came-first question about the lack of evidence-based economic policies in Japan and the poor state of statistics and statistics-based research. The low level of statistical understanding among policy makers, the media, the public, and researchers leaves interest in evidence-based policies at the low level. In turn, this lowers political support for adequate budgets for the statistics-generating sections, lowers morale among officials assigned to those sections, and depresses interest in improving the generation and design of official statistics. The vertical segmentation of the Japanese government hampers efforts to improve matters even further. Among Japanese economists, interest in empirical research has long been at a low level. This has led to low numbers both of scholars conducting empirical research, and of policy makers able to understand empirical work. In a world of multifaceted, complex, mutually dependent relationships (which is to say, in the world in which all of us live), understanding the interdependent causal chain is always hard. Understanding how to mitigate real-world problems is just as hard. This article begins the process of unraveling the reasons (the diagnosis) behind both the slow acceptance of the idea of evidence-based policies and the current state of statistical generation and usage in Japan. It suggests ways to begin to improve that situation (prescription). Improvement will not be easy. Instead, it will require a long time, an enormous investment in energy, and close cooperation among the many players involved.