Japan Wants to Monitor the Elderly with Robots, which Says a Lot about What’s Wrong with Abenomics
Months before the concept of Abenomics even existed, Masaaki Shirakawa, the former Bank of Japan governor, made an unusual argument for why it won’t work.
“In aging economies…[because] the scarce labor force imposes a natural constraint on labor supply, the marginal product of capital declines accordingly,” Shirakawa said in a speech. ”As a result, macroeconomic growth would be impeded (pdf, p.8).”
And now in plain English: Japan’s aging caused its deflationary spiral. If Shirakawa is right, Abenomics is doomed….
…Normally, high-skilled foreign workers are particularly helpful in boosting economic growth. And that’s exactly the kind of immigrant Japan has been targeting. Reforms introduced last year have opened up the system to high-skilled immigrants in academic research, business management and technical work. The country is also recruiting foreign students, most of them from China.
However, at the moment Japan already has a glut of high-skilled workers. “Over time some of the higher order jobs will [need to be filled by] skilled immigrants,” says Bhaskar Chakravorti, executive director for the Institute for Business in the Global Context at Tufts University. ”Certainly, initially you want the low wage jobs because those are the low hanging fruit,” Chakravorti tells Quartz. “To a large extent they’ve automated at lot of their higher end industries so it would be helpful to bring in people at the lower end, to take on service sector jobs.”
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