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Home Publications Blogs Beat the Press Japan's Declining Population Means a Smaller Supply of Labor

Japan's Declining Population Means a Smaller Supply of Labor

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Tuesday, 07 September 2010 04:07

It appears to be a standard ritual to cite Japan's declining population as an evil in all discussions of things Japanese. Today the NYT refers to the declining population as one of the factors making life bad for young workers.

Actually, a declining population is likely a plus for young workers. It means less competition for employment than would otherwise be the case. Falling population should also lead to improvements in the quality of life that will not be picked up in conventional economic measures. For example, its transportation system will be less heavily utilized, allowing people to reduce the time spent traveling to work and for other purposes.

Comments (6)Add Comment
US compared to Japan
written by scott, September 07, 2010 5:50
http://www.atimes.com/atimes/G...1Dj01.html

You get a spiff in this article where the author says we should be so lucky as to be Japan. Our lack of exports puts us in a less advantageous position than Japan. He also makes a good case for what our deficits mean to interest rates. Default and Argentinian stagflation are strikingly similar as I've argued repeatedly.
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written by izzatzo, September 07, 2010 6:35
For example, its transportation system will be less heavily utilized, allowing people to reduce the time spent traveling to work and for other purposes.


America is way ahead of Japan on this one as more unemployed are using increasingly less of the transportation infrastructure, the evidence in more extra wide seats available to young workers with no competitors. Even more space will be available after spending $50B on transportation.
social death spiral
written by frankenduf, September 07, 2010 7:53
this post is way too ivory tower- fact is, less population means less girls at parties and less overall alcohol consumption, which will lead to less procreation, and a further dip in population- Japan is actually at risk for disappearing @ the time the social security funds will run out!
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written by skeptonomist, September 07, 2010 8:48
Any article about population growth which does not discuss limits to resources, such as fossil fuels, is not realistic. This is not a new problem; most population crashes in the past can be ascribed to resource exhaustion. An economics which considers resources to be inexhaustible is likewise unrealistic.
Resource base
written by NoMan, September 07, 2010 10:20
"most population crashes in the past can be ascribed to resource exhaustion."

There's really only one, the Easter Egg Island. Fossil Fuels will last quite some time, unfortunately. The technology to get increasingly difficult oil reserves keeps going up, and at the same time, global warming makes oil reachable in places previously not possible. (Irony.)

For food, the world could feed exponentially greater numbers of people, the problem is that barn animals eat the majority of higher yield food sources. This contributes to methane production and drastically reduces the level of food available via trophic levels being less efficient at energy conversion each level you go up. If the govt. quit subsidizing agriculture both from tariffs and from direct subsidy and indirect subsidies like water, most of this problem would disappear as on a free market, the true costs of our agriculture system would be apparent rather than hidden.

In short, it's not inexhaustible, but we've not reached it yet.
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written by Dave Tuttle, September 07, 2010 12:16
Sure, it is better to see substantial positive GDP growth, but I would like to see per capita GDP comparisons for Japan, not simply real and nominal GDP. Does the picture look nearly as grim in Japan on a per capita GDP basis? It would seem that there would be more resources spread across fewer people in a traditionally overcrowded country.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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