Policy Research Domains (Major Policy Research Domains) I. Maintaining Economic Dynamism under the Adverse Demographic Conditions of Low Fertility and Aging Population

Economic Growth under Conditions of Low Fertility and Aging Population

Project Leader/Sub-Leader


YOSHIKAWA Hiroshi Faculty Fellow



OKAZAKI Tetsuji Faculty Fellow



MATSUMOTO Kazuyuki Faculty Fellow

Sub-Leader (2006 - )



To sustain Japan's economic growth under conditions of a declining population, research on productivity growth and innovations is vital. The present project focuses on the role of product innovations which the standard growth accounting or measurement of total factor productivity (TFP) does not fully capture. We also study other neglected aspects of technical progress and innovations. The labor participation of women and working hours are also examined.

2007 - 2008

To maintain Japan's economic vitality in the face of low fertility and aging population, it will be necessary to undertake comprehensive research on improving productivity and promoting technological innovation. Based on a keen awareness of such policy issues, this project is to analyze the mechanisms of economic growth from various angles. While existing studies of economic growth tend to be centered on Total Factor Productivity (TFP), this project will take in a broader range of themes from both experimental and peripheral studies. The project will also research the role of product innovation, an area with few prior empirical studies.


The Japanese economy has broken out of its prolonged recession and embarked upon a new phase of expansion. Looking ahead over the medium to long-term, however, it will be characterized by the aging of society and declining population, and it will follow a new path of growth never experienced in modern times, making it necessary to have knowledge and policies that differ from those before. Given this situation, in our research we analyze the factors that have a significant impact on economic growth under conditions of low fertility and an aging population. Specifically, these include the microstructure of innovation, the impact of technological advances on capital investment, the land system and agricultural productivity, labor mobilization, and the determinants of the labor force participation rates of women. We will also undertake basic research relating to measurement derived from the aforementioned themes (including the reexamination of the operating ratio index and the services deflator). Through the aforementioned studies, the objective of our research project is to gain new knowledge and draw policy implications in order to develop a strategy for future growth.

Until December 31, 2009

Major Research Results

Major Research Results


RIETI Policy Discussion Papers


RIETI Discussion Papers

CARF-RIETI Policy Symposium

  • July 03, 2009
    "Financial Crisis and the Future of the Japanese Economy"


RIETI Discussion Papers


RIETI Discussion Papers