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Innovations and traditions in the Japanese economy - a single whole

The West still does not pay enough attention to structural reforms introduced under the leadership of the Japanese Prime Minister, Shinzo Abe

Three recent events are an example of how Japan is trying to strengthen the basis for the implementation and development of domestic reforms and ensure social and economic stability against the backdrop of negative demographic changes within the country.

Innovations and traditions in the Japanese economy - a single whole
The macroeconomic situation of the third largest economy in the world remains unstable - the country's economy has shown negative growth over the past two quarters. The Bank of Japan's recent transition to negative interest rates did not have a noticeable positive impact on such factors of economic growth as inflow of investments and increased consumption of the population. These three events give us a clear idea that the country is an example of a peculiar combination of innovation and innovation with local conditions and traditions.

So, the first piece of news is related to the country's trade unions. As the policy of lowering interest rates negatively affects the profits of Japanese banks, the unions of the three largest financial institutions in Japan announced that in their annual negotiations with company representatives, which will take place in the spring, workers will not push for higher wages. From a cultural point of view, it can be concluded that the use of negative interest rates on bank deposits has become a confirmation of the viability and effectiveness of the traditional for Japan balanced system of socio-economic cooperation, which can also be called the "principle of harmony."

The Japanese term "shunto" or "spring wage negotiations" refers to the annual wave of collective bargaining, in which thousands of unions and employer representatives in Japan concurrently negotiate wage terms. For the first time, such collective actions began to be held after the end of the Second World War and is still used as an effective way of resolving labor conflicts, which allows the parties to agree on mutually beneficial terms without using radial means of influence. In previous years, when the country's economy was on the rise, trade unions of workers in a particular industry usually held a short, no more than a week in duration, protests or demonstrations, the scenario of which was carefully thought out in advance. Meanwhile, representatives of the National Confederation of Japan Trade Unions were negotiating, the main purpose of which was to increase wages, but at the same time the views and goals of all parties to the negotiation process were taken into account, which is based on the principle of cooperation, not competition, as well as the principle of maintaining a conflict-free relationship. rejection of opposition. This can explain the social and legal stability of the Japanese state, despite decades of economic recession. However, the flip side of the coin is the lack of dynamism inherent, for example, in the American economic model.

Economists have criticized the union's decision not to push for higher wages, arguing that it serves as further evidence of the failure of the so-called "Abenomics" or economic reform policies of Japanese Prime Minister Shinzo Abe. However, this case is a prime example of the unity and social cohesion that underlie the Japanese social organism. This may not be the best solution in terms of economic feasibility, but in Japan, stability for the sake of maintaining social harmony is still a key factor and can outweigh any private or group interests. In addition, the largest corporations in Japan in 2015 indexed the salaries of employees as much as possible, in response to Prime Minister Abe's call for cooperation in order to ensure an increase in consumer spending. The willingness to cooperate can be explained by the mobilization of capital and labor resources.

However, this does not mean that the socio-economic system of Japan is a kind of fossil fossil frozen in permafrost. Compared to my first impressions of visiting Japan more than a quarter of a century ago, the current retail economy has become more developed, more consumer-oriented. The centerpiece of the market economy in those early days was local specialty shops or family shops. Today Costco and Aeon have become commonplace in large cities, while the number of independent stores of traditional form has significantly decreased. Although, in the shadow of corporate giants, there are still small family businesses, which once again confirms the traditional principles of the Japanese way of life and thinking.

In the West, Shinzo Abe's structural reforms are controversial, often not attaching special importance to them, but such important changes as the liberalization of the retail electricity market in Japan can be noted. The Japanese government is pursuing a policy of increasing competition among manufacturers in the electricity sector, focusing on improving efficiency and promoting innovation in this sector of the economy. Changes in the energy sector are associated with the development of competition in generation, the liberalization of retail electricity sales and the abolition of the monopoly of regional companies. The Japanese edition of the Japan Times reports that, according to the National Consumer Affairs Center, complaints about aggressive illegal price regulation by electricity suppliers have increased.

But it is precisely this that can be called an excellent environment for developing the skills necessary to survive in a highly competitive environment, when the government, business communities and consumers must learn to survive and navigate in a confused economic space. Consumers must learn to evaluate the terms of the contracts offered to them and adequately evaluate the information about the benefits and benefits offered to them when comparing competing products and determining their own preferences. The Japanese government has also stepped up its consumer protection efforts by developing new anti-fraud measures with the Consumer Protection Society. Instead of abusing their market position or using unfair measures to influence consumer behavior, companies and businesses must learn to be responsible corporate citizens.

This strategy may seem destructive in the short term, as it involves the use of measures of legislative influence on unscrupulous players. However, it gives Japanese consumers more choice and allows new energy suppliers to enter the retail electricity market. All this should soon create a healthy economic environment for both producers and consumers. In addition, this initiative will contribute to the liberalization of the economy in the field of agriculture, land ownership, finance, taxation, etc. This will lead to an increase in consumer spending, which in turn will stimulate economic growth. This example once again convinces us that, as in the case of trade unions, the Japanese economic model includes unique elements of culture, management ethics, lifestyle and politics.

The process of reforming market institutions through their organic introduction into the Japanese civilization matrix, which is complex and multifaceted in itself, is accompanied by the most severe demographic decline in the history of industrialized countries with a democratic form of government. Japanese society is aging rapidly, with the explosion in fertility after the end of World War II giving way to a decline in fertility growth in the late twentieth century. The country's population has been declining as a result of natural decline since 2004. Japan has one of the highest life expectancies and is expected to be over 2060 by 40.

Those who live in Japan permanently or regularly visit the country can see significant changes. Since 1990, the countryside has fallen into desolation, while the cities are striking in the number of people, not only young people, but middle-aged and elderly people. Demographers estimate Japan could lose more than 27 million people of working age over the next four decades. There are reports in the media that some catering establishments cannot afford to work in the evening due to a lack of labor. The worsening demographic situation is the most serious threat not only to the economy, but also to the future of Japan as a whole.

However, despite the dire demographic situation, there are signs that the country is trying to cope with the problem. The shortage of the able-bodied population is made up for by people who have come from other Asian countries. For example, the most prominent feature of the health sector is the presence of doctors, nurses and other professionals who are citizens of the Philippines.

Another negative sign of the demographic shift is the number of older workers. According to the Japan Times, over 20% of Japanese people over the age of 65 continue to work, mostly part-time. Some of these people do volunteer work or charity work without earning anything or adding to their pensions. Many, however, do not limit themselves to social activities and do paid work, for example, in department stores in Tokyo or in local recycling centers, since in Japan the problem of waste disposal is very relevant. The so-called “silver centers” have become widespread in the labor market, where older workers have the opportunity to work in various areas of business for relatively low wages.

As noted earlier in this article, some older people continue to work because they do not have enough savings. Others try to stay mentally and physically active in this way. There are a huge number of elderly people who continue to work for this reason alone. While the typical American employee is eagerly awaiting retirement age so that he can quit his job as soon as possible and devote himself to playing golf, painting, or traveling the world, the Japanese have a diametrically opposite opinion. For those Japanese people who have no other choice and have to continue working at the age of 70 or even 80, the burden of labor may seem unfair. For others, work makes them feel like full-fledged members of society. A sense of meaning, purpose, and the effectiveness of the effort put into work is necessary for these people for a positive attitude towards life. However, both categories of workers are equally active in the social and economic life of Japan and in the development of the national economy.

The purpose of this article is by no means a desire to underestimate the scale of serious economic problems looming over the country, such as huge public debt, loss of competitiveness of companies and the entire national economy. Japan is struggling to implement a whole range of innovative services, strives to liberalize the economy, while trying to protect its status quo, the existing socio-economic system, the fundamental principle of which is traditionally a commitment to social stability, and all these processes are accompanied by negative demographic trends. Japan will never be able to return to its best 70-e и 80-e years of the twentieth century, but the traditional order, which is characterized by a single system of values ​​and national corporate traditions and relationships, may be much more durable than expected.
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