Japan and the World Economy最新文献

Recent years have seen a growing trend to utilize "alternative data" in addition to traditional statistical data in order to understand and assess economic conditions in real time. In this paper, we construct a nowcasting model for the Indices of Industrial Production (IIP), which measure production activity in the manufacturing sector in Japan. The model has the following characteristics: First, it uses alternative data (mobility data and electricity demand data) that is available in real-time and can nowcast the IIP one to two months before their official release. Second, the model employs machine learning techniques to improve the nowcasting accuracy by endogenously changing the mixing ratio of nowcast values based on traditional economic statistics (the Indices of Industrial Production Forecast) and nowcast values based on alternative data, depending on the economic situation. The estimation results show that by applying machine learning techniques to alternative data, production activity can be nowcasted with high accuracy, including when it went through large fluctuations during the spread of the COVID-19 pandemic.

This study examines the role of part-time employment in Japan’s business cycles from 2002Q1 to 2018Q3 using a two-sector competitive search and matching model. The model is estimated by the generalized method of moments (GMM). The results demonstrate that part-time employment exhibits significantly higher volatility compared to full-time employment in response to productivity shocks. Companies adapt their utilization of part-time labor through both extensive and intensive margins to a similar extent, which stands in contrast to full-time workers whose labor input variation is primarily explained by the intensive margin. These findings substantiate the concept of part-time employment serving as an “Adjusting Valve for Employment” within the Japanese labor market. However, the model only accounts for a limited portion of the fluctuations in the proportion of part-time workers among total employment. The GMM estimation reveals that a general productivity shock adequately explains variations in wage rates and market tightness, but it falls short in accounting for fluctuations in the share of part-time employment. Thus, the findings suggest the necessity for more sophisticated models to amplify the variation in part-time employment while keeping wage rates and market tightness unchanged.

This paper studies the determinants of Japanese direct investment worldwide and in different country groups. We derive our research hypotheses from the Knowledge-Capital Model and test them empirically using the PPML model and statistical data for 179 target countries between 1995 and 2019. We examine the role of a host’s institutional quality in affecting the cost of FDI. We show that institutional quality matters in attracting Japanese FDI for developed, developing, and transitioning economies. We find the effect of institutional quality to be more pronounced in the latter group of countries, especially concerning industries characterized by high asset-specificity.

This study investigates the impact of introducing corporate social responsibility (CSR) committees on firms’ CSR performance. Using a sample of publicly traded Japanese companies for the period of 2011–2021, we employ propensity score matching difference-in-differences methods to address endogeneity issues. Our main findings reveal that the introduction of a CSR committee significantly improves CSR performance, providing support for the importance of structured and dedicated efforts toward achieving sustainability. In addition, our study contributes to the literature by examining the effects of the detailed components of environmental and social scores on CSR performance, offering a granular understanding of how CSR committees may influence various aspects of CSR performance.

In 2021, new bank forms, such as Internet-only banks, amassed 2 % of Japanese deposits. Tokyo’s statistics since 2005 encompass deposits in such banks, regardless of depositor location. These Tokyo-based banks operate branchless. Elevated deposits reported in Tokyo, Japan’s highest-income prefecture, could skew the income elasticity of money demand upwards in a cross-sectional regression. This study proposes reallocating Tokyo’s bank deposits to all prefectures to quantify the bias. Additionally, it suggests aggregating fifteen prefectures into five areas to address discrepancies between the deposit and income locations owing to cross-prefectural commuting. Adjusting for new bank deposits, the income elasticity of money demand decreased from 0.899 to 0.872 in March 2021, with overestimation increasing since March 2005. These findings suggest the adequacy of regional statistics in reflecting economic behavior in the digital era, warranting reevaluation.

After the bursting of real estate bubbles in 1991, Japanese banks continued lending to unviable firms to conceal problem loans. We revisit Japan’s experience and propose a new mechanism via which banks’ loan-evergreening policy undermines allocative efficiency across industries by focusing on construction and real estate loans. Namely, banks’ continuing support for construction and real estate firms encourages labor hoarding in unviable construction projects. Since construction projects predominantly use low-skilled workers, banks’ loan-evergreening policy in these troubled sectors may depress other low-skilled industries. Based on the industry-level data in each of Japan’s 47 prefectures from 1992 to 1996, we document empirical facts consistent with this hypothesis. On average, low-skilled industries experienced disproportionately slower output and employment growth and more sluggish growth in the number of new establishments in prefectures where the share of bank loans to local construction/real estate sectors increased more after construction boom ended.