The growth strategy of Abenomics and fiscal consolidation ¬リニ

Miyazawa, Kensuke, and Yamada, Junji—The growth strategy of Abenomics and fiscal consolidation Using a general equilibrium model with an overlapping generation structure, this study examines the impacts of a new Abenomics growth strategy on fiscal consolidation in Japan. Our simulation yielded the following results. (i) It is difficult to achieve the government target of fiscal consolidation by the year 2020 even when assuming that the growth strategy has the desired effects. (ii) Moreover, further economic and fiscal reforms are required from 2030 to 2070 because of accelerated population aging. (iii) However, population policy and an extended retirement age contribute to significant improvements in Japan’s fiscal condition after 2070. (iv) In contrast, the promotion of productivity and the labor force participation rate have a lesser impact on fiscal reconstruction. J. Japanese Int. Economies 37 (2015) 82–99. Faculty of Economics, Kyushu University, 6-10-1 Hakosaki, Higashi-ku, Fukuoka 812-8581, Japan; Faculty of Economics, University of Toyama, 3190 Gofuku, Toyama 930-0055, Japan. 2015 Elsevier Inc. All rights reserved. http://dx.doi.org/10.1016/j.jjie.2015.05.004 0889-1583/ 2015 Elsevier Inc. All rights reserved. q An earlier version of this paper was presented at the APEA and TCER conferences. We are grateful for the helpful comments of an anonymous reviewer, Tomoaki Yamada, Real Arai, and other participants. We also wish to express our appreciation to the Editor of this journal, Shin-ichi Fukuda. We would like to acknowledge financial support from JSPS Grant-in-Aid for Scientific Research (B) (24330094). Yamada is grateful for financial support by JSPS Grant-in-Aid for Challenging Exploratory Research and Core-to-Core Program (B), Asia–Africa Science Platforms. ⇑ Corresponding author. E-mail addresses: [email protected] (K. Miyazawa), [email protected] (J. Yamada). J. Japanese Int. Economies 37 (2015) 82–99