Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/189920
Authors: 
Otsu, Keisuke
Shibayama, Katsuyuki
Year of Publication: 
2018
Series/Report no.: 
School of Economics Discussion Papers 1809
Abstract: 
This paper analyzes the Postwar Japanese economy with a parsimonious neoclassical growth model that incorporates the demographic transition in Japan. We find that i) the increase in the aged-population share can account for most of the decline in employment and reduced output by 8% from its potential level, ii) workweek shortening policy led to a 20% reduction in output from its potential level by reducing hours worked over the 1988-1992 period, iii) labor income tax led to an 11% reduction in output from its potential level by discouraging hours worked, iv) the shift in the composition of government spending may have caused a slowdown in productivity growth and hence a reduction in the potential output level itself.
Document Type: 
Working Paper
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