Research Programs: Raising Industrial and Firm Productivity

East Asian Industrial Productivity

Project Leader/Sub-Leader


FUKAO Kyoji (Program Director, Faculty Fellow)



Japan's economic challenges are deepening: growth continues to be sluggish and large firms in the manufacturing sector are losing international competitiveness. Reasons include the declining population and slow total factor productivity (TFP) growth, as has been widely highlighted. Additional reasons include the decline in investment in tangible assets since the late 2000s, as well as the decline in labor quality observed for the first time since the late 2010s due to the increase in part-time employment and the retirement of many skilled workers, the lack of improvement in the sluggish investment in intangible assets (where investment in economic competencies such as in-house training of workers and organizational structure is particularly low), and the narrowing of the gap with other East Asian countries such as China. Moreover, the rapid advances in the use of digital technology as a result of the COVID-19 pandemic and changes in the international division of labor due to the confrontation between the U.S. and China may have a significant impact on the future growth path of the Japanese economy.

This project aims to carefully examine structural changes in the Japanese and East Asian economies and contribute to the design of growth strategies based on evidence through the following:
(1) Analyses of changes in labor and capital inputs (including intangible assets) as well as TFP growth at the detailed industry level using the Japan Industrial Productivity (JIP) Database.
(2) Analyses of the slowdown of the Chinese economy using the China Industrial Productivity (CIP) Database.
(3) International productivity comparisons and analyses in collaboration with the World KLEMS, EU KLEMS, and Asia KLEMS projects, and the OECD.
(4) Analyses of the impact of the technological developments referred to as the fourth industrial revolution, the internationalization of firms, and natural disasters such as the COVID-19 pandemic on productivity dynamics, using official firm and establishment data, and analyses of the effects of productivity dynamics on the Japanese economy.
(5) Analyses of the causes of regional productivity differences in Japan and the impact of regional development and other policies through collaboration with the Regional-Level Japan Industrial Productivity (R-JIP) project and construction of a detailed productivity database by industry and commuting area.
(6) Extension of data on listed firms in Japan, China, and Korea included in the East Asian Listed Companies (EALC) database to most recent years using firm-level data from the Development Bank of Japan's Corporate Financial Databank. Comparison of the impact of R&D on productivity using these data.

July 1, 2021 - December 31, 2023

(During the research project period, the research activity period is set from July 1, 2021 to June 30, 2023, and the data usage reporting period is set from July 1, 2023 to December 31, 2023.)

Major Research Results


RIETI Discussion Papers

RIETI Policy Discussion Papers


RIETI Discussion Papers