Strategies for Reviving the Japanese Economy :: essays papers

Strategies for Reviving the Japanese prudenceIntroduction1. Assessment of the Current Economy The Japanese economy has begun to show some signs of change as the effect of recent large-scale economic packages have gradually helped to stop the direful economic downturn. But despite this progress, private demand as a whole remains stagnant. Therefore, the economic prospects for self-supported recovery argon still suspicious once the economic effects of the last packages have phased out. The fundamental problems liable(p) to the weak economy atomic number 18 twofold. First, the true adjustment of the burst of the cardcastle economy is still insufficient. Second, against the background of the sharp decline in the image of births and the rapid aging of the population, the pace of which has not been experienced in otherwise industrialized nations, the Japanese system--the engine of the countrys astonishing high ontogenesis in the postwar era--has turned problematic with regard to economic growth. First, fears intimately employment prospects, future tense pension plans, and the sharp rise in giving medication deficits are obviously restraining an economic turnaround. These fears are attributable to eroding sustainability in the Japanese-style wage and employment systems and the generous social security system. To cope with the situation, sustenance of renewed safety nets are urgently pauperisationed. Furthermore, the rising financial deficits are restraining economic upturn by making people serious about future tax hikes and raising long-term interest rates. Measures to restore government fiscal balances in the medium and long term are also required. Second, the Japanese social system, which has looked highly on across-the-board equality, has generated a bloated public domain and inefficient resource allocation. Typical examples are excessive regulation, overprotection, lack of self-reliance, and the convoy system. To cope with these proble ms, a new system needs to be reinforced in which all production factors such as with child(p), labor, and land should be best allocated in a more efficient way by fundamental reforms in the public sector and full utilization of the foodstuff mechanism. Third, a Japanese management style that depends on unrealized capital gains has become obsolete by international standards, and has made the new argufy difficult. The Japanese financial system of indirect financial intermediation, which is based on land as collateral, has been malfunctioning. A new business management as well as a new financial system that depart fit the Japanese economy in the 21st century need to be established early, so that the abundant savings of Japan are best mobilized for economic development in the next century.