The Sound of Economics
What can Europe learn from Japanification?
Oct 16, 2024
Join Jacob Funk Kirkegaard, a Senior Fellow at Bruegel, and Takeshi Tashiro, a Non-resident Senior Fellow at the Peterson Institute, as they explore the complex lessons Europe can learn from Japan’s economic struggles. They discuss Japan's effective management of aging populations, low productivity, and high public debt. The conversation dives into labor participation trends, the importance of fiscal sustainability, and innovative financing solutions needed for a sustainable energy transition. Gain fresh perspectives on addressing Europe’s emerging economic issues!
35:53
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Quick takeaways
- Japan's management of high public debt demonstrates that it can be sustained through low servicing costs and effective fiscal policies.
- Increasing female labor participation in Japan highlights the importance of inclusive policies for sustaining economic growth amid demographic challenges.
Deep dives
Lessons from Japan's Economic Resilience
Japan's experience with economic challenges due to an aging population and low growth offers significant insights for Europe. While the term 'Japanification' is often associated with negative connotations, Japan's sustained economic growth over the past decade suggests a more nuanced perspective. Japan has effectively managed its fiscal policies, with government spending as a percentage of GDP remaining lower than that of many European nations. Understanding Japan's approaches, including their ability to maintain growth and control spending despite demographic shifts, could provide valuable lessons to European countries facing similar structural changes.
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