How Uncertain Are Economic Policies? Evidence from a survey on Japanese firms

Author Name MORIKAWA Masayuki (Vice Chairman & Vice President, RIETI)
Creation Date/NO. April 2016 16-P-008
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This study, using data from an original survey covering both public and private firms in Japan, presents evidence on uncertainties over economic policies, their effects on managerial decisions, and firms' evaluations of the government's numerical targets related to economic policies. This study is an extension of Morikawa (2013), but the survey greatly expands its coverage including private firms and adds new questionnaires. The results indicate that Japanese firms perceive uncertainty over the future course of certain economic policies, such as the social security system, tax policy, fiscal expenditures, and international trade policy. Policy uncertainties have substantial effects on managerial decisions, especially on equipment investment and hiring of regular employees. Medium- to long-term numerical targets related to the government's economic policies are generally perceived to be difficult to achieve.

This is the English version of the Japanese Discussion Paper (16-P-005) with some additional information and changes.

Published: Morikawa, Masayuki, 2016. "How uncertain are economic policies? New evidence from a firm survey," Economic Analysis and Policy, Vol. 52, pp. 114-122