growth

Japan: stagnation or maturity?

A couple of years ago I wrote about how Japan might be the world’s first truly post-growth country. That could be a good thing as far as I’m concerned, though the rise of Abenomics since then suggests the majority of Japanese don’t yet agree. I’ve had my eye on the situation though, waiting to see if we were going to hear more about this. I’ve heard rumours that there’s a growing number of people recognising that the end of growth hasn’t been so bad, but presumably it’s mostly written in Japanese.

In the meantime, the New Statesman covered it last year, pointing out that “Japan is still one of the richest, most civilised and convenient countries in the world”, when the economic logic suggests that “there should be potholes in its streets and pickpockets in its alleys. Shops, restaurants, bars and factories should be darkened and idle. Trains should be late and the passengers poorly dressed and busking for change.”

But apparently not. Japan appears to prove that a country can run without substantial economic growth for two decades and not collapse.

japan-gdp

So the question for Japan is whether it can settle into a new role as a pioneer of post growth economics, and accept this as a new normal. The alternative is presumably to double down on the debt and keep trying to stimulate the economy, but if the last 20 years have been okay, why take that risk?

This week David Boyle made that same observation, wondering if “perhaps the key moment is not when Japan rejoins the nations who succeed in stimulating growth, but when they accept that they are the first post-growth economy and start seeking out ways of making it work for them.”

And then there’s this, from Japanese economist Noriko Hama. She proposes that Japan’s future “could be all about affluence, maturity, refinement, and leisureliness. It could be about all about being grown up. A grown up economy that is the envy of the rest of the world. That could be Japan’s position in today’s scheme of things.”

Indeed – and I’m interested to see who else is using that positive language about post growth as maturity rather than stagnation. If any readers speak Japanese are are aware of relevant commentary on this, let me know.

One comment

  1. You really should look at GDP per capita which since Japan has a declining population is still rising, albeit slowly.

    Of course the thing that is rising is the national debt, at 245% of GDP and as the population falls it will get harder to self finance as they have done so far.

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