ATRL Contributor
Member Since: 1/1/2014
Posts: 35,912
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Women are going to save Japan
Quote:
Why do economies grow?
It’s a simple recipe, actually.
Add rising labor productivity—total output per worker—to an increase in the number of people working, or some combination of the two. Shake vigorously. Voilà.
But it’s easier said than done, especially for countries like Japan where populations are stagnant or shrinking. The population of the world’s third-largest economy—roughly 127 million—has been in decline since 2010, due to low birth rates and Japan’s traditional ambivalence about immigration.
In fact, weak population growth is one of the reasons that Japan has been locked in a decades-long battle to re-energize an economy that remains deeply damaged by the real estate and banking bust it suffered in the early 1990s.
Prime minister Shinzo Abe’s three-part program of aggressive monetary policy, aggressive government spending, and labor market reform is aimed at jolting the economy back to life. And there are some signs its working. But here’s one of the most-promising indicators that things really could be changing in Japan. Women are coming into the workforce.
This is a huge development. Japanese women have traditionally worked far less than females in many other wealthy nations. Since the overall population is stagnant, pulling women into the labor force is one of the obvious levers the country can pull to boost the size of its labor force, and thus the productive capacity of the economy. Abe has famously claimed that Japan’s women are the resource-poor island nation’s “most-underutilized resource.”
“This is simply bigger than anything else Japan could have done,” said Adam Posen, president of the Petersen Institution for International Economics,
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