Research Programs (FY2024-2028)

While the sustainability of long-term growth is becoming a challenge for the entire global economy, our country is facing the dual challenges of a rapid aging population and declining birthrate ahead of other nations.
Concerning our economy, it is important to enhance productivity, revitalize economic activities such as corporate capital investment, which has stagnated over the past quarter-century, and improve the economic growth rate.
This program will conduct research that contributes to policy recommendations for the development of the future Japanese and global economies.
Specifically, it involves analyzing the response of the Japanese and global economies to economic shocks, household heterogeneity, the macroeconomics of individuals and families, and the mechanisms of long-term economic stagnation.
Additionally, multi-faceted and integrative research is conducted in relation to experimental and data-driven analysis towards a sustainable society, the relationship between exchange rates and the Japanese economy, and more.

In formulating economic and industrial policy, a deep understanding of international trade, foreign direct investment, and various other international economic activities is essential. In particular, in recent years, as geopolitical risks have expanded globally and protectionist policies have emerged, leading to movements against globalization, determining what policies Japan should pursue in the fields of trade and investment has become a significant focus of policymaking. At the same time, it is necessary to implement trade and investment policies to achieve sustainable economic growth from a longer-term perspective.
Based on this understanding, this program conducts research contributing to the formation of these policies through empirical analysis, theoretical analysis, and legal institutional analysis. In particular, our empirical research involves analyses using various data, including microdata based on government statistics and unique surveys, contributing to EBPM (evidence-based policy making).

The Regional Economy Program elucidates various issues facing regional economies through efforts on the following research subjects. (1) Empirical analysis and future projections based on economic agglomeration theory regarding metropolitan areas and urban center formation, (2) policy planning and evaluation aimed at increasing exchange population while strengthening mutual regional collaboration without competing with the settled population, (3) analysis of the impact of building corporate networks through innovation activities and globalization on regional employment and wages, (4) analysis of initiatives and ability formation for evaluating businesses based on research on the role and challenges of regional financial institutions, (5) research on growth factors for startups and regional revitalization utilizing local resources, (6) re-evaluation of urban agglomeration effects and research on the impact of land use regulations through analysis of urban residents' consumption and people flow data, (7) evaluation of the effectiveness of business continuity plans and disaster countermeasures for small and medium-sized enterprises.

The creation of new knowledge and its application to addressing economic or non-economic issues such as environmental protection are at the core of innovation, including the Fourth Industrial Revolution. We develop original data that will allow us to understand this process and conduct research that will make contributions with international recognitions as well as to policy formation aimed at accelerate innovation. Specifically, the focus is on analyzing the innovation capabilities of industries, government policies supporting research and development, industry organizations and market practices conducive to innovations by startups and through vertical specialization, the structure of intellectual property systems and technology standards, and industry-academia collaboration. The study is conducted from an international perspective, including an international comparison of innovation performance.

Amidst a turning point in industrial policy, there is a need for creativity to stimulate private investment and innovation in order to resolve socio-economic problems.
As the uncertainty of the global economy increases, with digital technologies being implemented in society and decarbonization efforts advancing, there is a need to redesign our country's socio-economic system to effectively incorporate technological advancements and create a new industrial economic framework.
We have entered an era where various economic activities converge across industry boundaries through DX and GX, and in addition to traditional policies for individual industries, we are conducting research on identifying the challenges faced by our national economy, the nature of cross-industry and business-level policies, and how to overcome these challenges.
*From April 1, 2025, the Program name has changed from Industry Frontier.

Since the 1990s, Japan has fallen behind other developed countries, such as the United States, the United Kingdom, and Germany, by a large margin in terms of its gross domestic product per capita and the increase in its real wage rate. The main factors causing this include the stagnation of the total factor productivity (TFP) and the significant slowdown in capital stock accumulation, including intangible assets and information and communications technology (ICT) particularly since the mid-2000s. This program will update and develop databases concerning the industry-level productivity and factor inputs in Japan and China (Japan Industrial Productivity [JIP] Database and China Industrial Productivity [CIP] Database) and the Regional-Level Japan Industrial Productivity (R-JIP) Database, which measures the TFP for each industry by prefecture. The program will also examine the types of policies required to improve productivity and facilitate investment via empirical analyses using these databases and firm/business-level data.

With the rapid decline in birthrate and aging population, leading to a population decrease and a growing shortage of labor, coupled with the significant transformation of the economy due to new technologies such as ICT and AI, For Japan, a resource-poor country, to maintain and strengthen its economic vitality and innovation and increase its growth potential while leveraging its strengths, the public and private sectors must focus on increasing both the amount and efficiency in utilization of human capital as key factors.
We conduct multifaceted and comprehensive research on the redesign of employment and labor systems suitable for the AI era, the promotion of human capital management, the formation of AI-complementary abilities and skills, and the necessary education and training reforms, in addition to addressing gender disparities in STEM fields. Strategies to enhance worker well-being through health-focused management practices and the application of human capital management to the public sector are also explored utilizing unique data sets.

One of the major issues afflicting the Japanese economy is the existence of barriers, such as the barriers between permanent and non-permanent employees and between men and women in the workplace. RIETI has been addressing various problems concerning these barriers in the economy. Academia has also been suffering from this problem of barriers, for example, barriers between humanities and sciences, between legal studies and economics, between microeconomics and macroeconomics, and between theory and empirical testing. It is essential to remove these barriers to increase the capacity for innovation and enable organizations to become more sophisticated. The Integrated Research program uses this perspective to undertake research and incorporate new knowledge from other disciplines, such as natural sciences, law, political science, and sociology, into economics and policy studies.

The Policy Assessment program will accelerate Evidence-Based Policy Making (EBPM) by simultaneously researching the ideal form of EBPM and evaluating individual policies. Regarding the research on the nature of EBPM, we will employ a meta perspective to analyze how policymakers should prepare evidence and formulate policies based on such evidence, as well as the extent to which EBPM is practiced. Regarding the evaluation of individual policies, the program will use high-quality microdata and empirical microeconomic techniques to provide credible evidence to contribute to policy making in education, labor, tax, social security, and other areas.

In our Sixth Medium-Term Plan (FY 2024–2028), RIETI will undertake research using the following framework.

The most important focus of our role will be to contribute to policy planning and implementation, while making maximum use of our strengths cultivated as a "knowledge platform" (by accumulating high-quality research results, maintaining a rich research network, ensuring high recognition inside and outside the country, providing various useful databases, and other functions). We will conduct our research activities based on the government's medium- and long-term policy issues (in particular, the "New Direction of Economic and Industrial Policies," which aims for sustainable economic growth through the resolution of societal issues), and also with future policy issues in mind.

The "Research Programs" have been established for policy research fields that have a certain cohesiveness. In FY2024 there will be nine research programs inherited from the 5th Mid-term Objectives Period, and the following seven research programs will be established (see the figure below) from FY2025, under which research activities will be conducted.

RIETI provides discussion forums (e.g., at the launch of research projects, and discussion paper/policy discussion paper seminars) and invites policymakers to these forums to improve the quality of our research and build linkages between our research and policy.