Raising Industrial and Firm Productivity

The aim of the program titled Raising Industrial and Firm Productivity is to measure industry- and firm-level productivity and its determinants for Japan and various East Asian countries and to conduct research on policies aimed at raising productivity. At the industry level, the program—in addition to updating and expanding the Japan Industrial Productivity (JIP) and China Industrial Productivity (CIP) databases in collaboration with Hitotsubashi University—will construct an industrial productivity database by prefecture for Japan and examine the impact of the recent earthquake on regional economies and policies for reconstruction. At the firm or establishment level, employing micro-data from government statistics and corporate financial data in Japan and abroad, the program will research the following: productivity differentials between firms, the impact of globalization, how changes in demand affect corporate performance, policies for raising productivity in the service sector, and productivity dynamics from an international perspective—including productivity differentials between Japanese, Chinese, and Korean firms—as well as other related issues.

At the industry and firm level, the program will measure investment in intangible assets such as research and development, software, in-house training and organizational structure—all of which are important sources of innovation and productivity growth—and will examine the economic effects of such investments.

The program will closely cooperate with a range of domestic and overseas research institutions, which will help make it possible to compare productivity and the determinants of productivity in Japan with other countries. At the same time, this will contribute to improvements in government statistics and the statistics of international institutions, and to domestic and overseas research on productivity.

Collaborating with the Asian Development Bank Institute (ADBI), Harvard University, and others, one aim of the program is to measure the industrial structure and productivity of various Asian countries and to push ahead with the construction of the Asia KLEMS Network, which compares the industrial structure and productivity of various Asian countries with other regions of the world. In addition, the program will continue to provide data on Japan's industrial structure to the EU's World Input-Output Database project and will provide data to the Organisation for Economic Co-operation and Development (OECD). Furthermore, the program will cooperate with researchers of the Economic and Social Research Institute of the Cabinet Office of Japan on the construction of a productivity database directly linked with system of national accounts (SNA) statistics and development of methods for measuring the output of non-market services such as health care and education. Meanwhile, with researchers of the National Institute of Science and Technology Policy (NISTEP) of the Ministry of Education, Culture, Sports, Science and Technology (MEXT), the program will conduct studies on the sources and effects of innovation.

In addition, the program will conduct research in collaboration with researchers from Imperial College (University of London), Seoul National University, the OECD, and other institutions on the international comparison of investment in intangible assets, and with researchers from Beijing University, Sogang University, and other institutions on the international comparison of productivity at the firm level. For the international comparison of productivity levels, we have won the cooperation of the International Comparison Program (ICP) led by the World Bank, for purchasing power parity data.