Marriage Rate and Female Labor Participation Rate: Evidence from Japanese prefectural cross-section (Japanese)

Based on Japanese prefectural cross-sectional data, marriage rates and female labor force participation rates are positively correlated, while the trade-off between them has been observed with time series data. The key fact for understanding this positive correlation is that job exit rates due to marriage vary across prefectures while almost constant over time. Since a decline in marriage rates over last two decades has been strongly correlated with the turnover rate, a positive correlation has emerged. In addition, the exit rate depends on the availability of child care services, while childcare leave or cohabitation with parents has little affect on the rate.

Child Benefit Payments and Household Wealth Accumulation

Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/115934/1/jere12078.pd

Demand Driven Innovation and Uncertainty: Evidence from diffusion of flat panel TV (Japanese)

In a case-study, we show that developing new goods is constrained by demand uncertainty. It was believed that knowing "needs" would be critical for R&D investment decisions, and thus developing new goods. However, although the need for flat panel televisions was known for many years, they were not developed for a long time. It was not a limitation of technology but demand uncertainty that prevented the innovation. The implication of this case study is that reducing uncertainty is effective in promoting innovation.

The Intertemporal Substitution and Income Effects of a VAT Rate Increase: Evidence from Japan

One of the biggest political issues in Japan is an increase in the rate of value added tax (VAT). In this paper, we evaluate its impact on household expenditure, using Japan's April 1997 VAT rate increase from three to five percent as a case study. A rate increase induces price hikes, and provided this increase in price levels is anticipated, households should engage in intertemporal substitution of purchases. In addition, if households are not compensated for the rate increase, it has the potential to induce an income effect on household consumption. Based on monthly household expenditure data, we find that households spent 30,231 yen more in the quarter prior to the rate increase than they would have in its absence, while the income effect was negligible. Consistent with theoretical predictions, increased outlays on durable and storable non-durable goods and services were responsible for roughly three-quarters of the observed intertemporal substitution effects. Contrary to conventional wisdom, we find that the VAT rate increase had no impact on real household spending following its implementation, once we have accounted for intertemporal substitution, which caused a large transitory disturbance in household expenditures.

Discrepancy between Saving Rates in SNA and Family Income and Expenditure Survey and Its Implications (Japanese)

Discrepancy between saving rates in the System of National Accounts (SNA) and the Family Income and Expenditure Survey (FIES) has been resolved using newly available statistics. While the known factors such as differences in coverage and definition of savings explain around 70% of the discrepancy, the underreporting of durable goods purchases and asset income in FIES accounts for the rest. According to the corrected savings rate, the savings rate for retired households dropped sharply after 1993, which would be one of the main reasons for lower savings rates over the last two decades.

The Consumption Response to Seasonal Income: Evidence from Japanese Public Pension Benefits

Japanese public pension benefits, which were distributed quarterly through February 1990 and every other month since then, induce substantial but predictable income fluctuations. The relative magnitude of the payments combined with the delay between payments yields a stronger test of the Life-Cycle/Permanent Income Hypothesis than in prior studies. Applying two identification strategies to monthly household panel data, we find that consumption significantly responds to quarterly benefit receipt. Additional analysis suggests that our findings cannot be explained by either liquidity constraints or precautionary savings motives.

Consumption Responses to the Child Allowance (Japanese)

This paper investigates consumption responses to the child allowance benefits. Life-cycle permanent income hypothesis predicts that the responses are likely to be limited, as the increase in life-time income resulting from the benefits is small relative to other income resources. The data analysis and a review of the Japanese Family Income and Expenditure Survey generate results that are consistent with this theoretical prediction. The estimated impact on consumption ranges from 1% to 3% of the total expected benefit annually depending on specifications. Also, the distribution of financial assets suggests that most of benefits have been saved. While the child allowance hardly affects household consumption on average, households with borrowing-constraints exhibit large responses to the monthly benefit payments, and this suggests that the child allowance may mitigate such borrowing constraints. An earnings test should be applied if the government wants to more effectively assist those households with borrowing-constraints.

Consumption Behavior of Elderly Households and Price Index (Japanese)

This paper constructs a price index for elderly households in which differences in expenditure share and points of purchase are explicitly taken into account. Elderly households spend more on food and medical care, while younger households spend more on education, transportation, and communications. As for points of purchase, in general, elderly households spend less in discount stores. These differences result in an underestimation of the inflation rate for elderly households by 2%, of which, 1.5% is due to differences in expenditure share and 0.5% is due to differences in points of purchase. However, even after taking such differences into account, the inflation rate for the elderly is less than that derived from the official CPI, which does not take into account points of purchase. Accordingly, the existing price indexation of pension benefits likely results in higher-than-appropriate benefit levels.

The Impact of Deregulation in the Retail Sector: Implications for the aging society (Japanese)

In this paper we consider the implications for Japan's aging society and low birth-rate with respect to the enhancement of efficiency in the retail sector. While it is, in general, difficult to measure the productivity of the retail sector, we made it possible, using a deregulation as a natural experiment, to evaluate the impact of the enhancement of efficiency on economic welfare. The efficiency of the retail sector plays an important role in an aging society from two perspectives. First, there is the perspective of the achievement of innovation. The second perspective is that for elderly people and women in employment, the burden of purchasing behavior itself is heavy, and determines quality of life. Specifically, in this paper we analyze an aspect of the deregulation implemented in March 1999 that had a particularly large impact, namely the effective liberalization of the sale of medicinal drinks, so as to analyze the effect of the enhancement of the efficiency of the retail sector. As a result of deregulation it became possible for almost all supermarkets to sell medicinal drinks, and their sales volume increased abruptly. We show that, on the other hand, prices did not fall commensurately, and the effects of deregulation impacted consumers through non-price factors. In addition, the very fact that the number of outlets selling the drinks increased may have made it more convenient for consumers, and so we build a model to decompose the price-lowering effect of deregulation and the non-price effect in the form of the enhancement of convenience. According to our estimations, the deregulation has had an economic welfare improvement effect equivalent to �15.1 billion income increase, assessed by using compensating variation. We also find that at least 90% of this effect is not attributable to price-lowering effect but to a non-price factor, namely the enhancement of convenience. Our study thus demonstrates that the enhancement of the efficiency of the retail sector is an important means of innovation, and that through convenience it has the effect of enhancing the quality of life.

Lifecycle/Permanent Income Hypothesis and Evolution of Macroeconomics

本稿では，現代のマクロ経済学の主要な構成要素のひとつであり，ライフサイクル・恒常所得仮説（Life Cycle / Permanent Income Hypothesis: LCPIH）として知られる「合理的な家計」の仮定を軸に，新しいマクロ経済学の方向性を考察した．LCPIH の検証の過程は，マクロ経済学の発展と密接に関連している．実証的な先行研究の多くが「狭義の」LCPIH を棄却する一方で，資本市場の不完全性等の理論的な拡張によって合理的な家計の仮定自体は維持されてきた．しかし，最近の研究でより広い意味でもLCPIH が成立していないことが示された．その理由として，行動経済学が示唆するような心理的な要因が有力とされている．新しいマクロ経済学を構築するには，行動経済学の知見を活用することが欠かせない．また，経済政策としては，行動経済学に基づくリバタリアン・パターナリズム的な政策を考慮に入れる必要がある．Rational household is one of key factors of modern macroeconomics. The hypothesis that rational households maximize their utility subject to some restrictions is known as Lifecycle/Permanent Income Hypothesis (LCPIH). The LCPIH has contributed tozevelopments of macroeconomics and many useful tools for empirical macroeconomics were invented in order to test the LCPIH. The LCPIH is extended to take many realistic factors into account such as uncertainty in income, incomplete capital market, and/or nonseparability of leisure and consumption. Nevertheless, recent study rejected the LCPIH, and suggested that behavioral economics would explain the rejection. Macroeconomists should try to accommodate behavioral economics in their model.特集　新しいマクロ経済理論の構築を目指し