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Information Technology and the Japanese Economy

In: Enhancing Productivity (NBER-CEPR-TCER-Keio conference)

Author

Listed:
  • Dale Jorgenson
  • Kazuyuki Motohashi

Abstract

In this paper we compare sources of economic growth in Japan and the United States from 1975 through 2003, focusing on the role of information technology (IT). We have adjusted Japanese data to conform to U.S. definitions in order to provide a rigorous comparison between the two economies. The adjusted data show that the share of the Japanese gross domestic product devoted to investment in computers, telecommunications equipment, and software rose sharply after 1995. The contribution of total factor productivity growth from the IT sector in Japan also increased, while the contributions of labor input and productivity growth from the Non-IT sector lagged far behind the United States. Our projection of potential economic growth in Japan from for the next decade is substantially below that in the United States, mainly due to slower growth of labor input. Our projections of labor productivity growth in the two economies are much more similar.
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(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Dale Jorgenson & Kazuyuki Motohashi, 2004. "Information Technology and the Japanese Economy," NBER Chapters, in: Enhancing Productivity (NBER-CEPR-TCER-Keio conference), National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberch:0182
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    References listed on IDEAS

    as
    1. Mun S. Ho & Dale W. Jorgenson & Kevin J. Stiroh, 2004. "Will the U.S. productivity resurgence continue?," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 10(Dec).
    2. Jorgenson, Dale W. & Nomura, Koji, 2005. "The industry origins of Japanese economic growth," Journal of the Japanese and International Economies, Elsevier, vol. 19(4), pages 482-542, December.
    3. Susanto Basu, 1996. "Procyclical Productivity: Increasing Returns or Cyclical Utilization?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(3), pages 719-751.
    4. Motohashi, Kazuyuki, 2007. "Firm-level analysis of information network use and productivity in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 21(1), pages 121-137, March.
    5. Dale W. Jorgenson, 1995. "Productivity, Volume 1: Postwar US Economic Growth," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262100495, December.
    6. Brynjolfsson, Erik. & Hitt, Lorin M., 1994. "Information technology as a factor of production : the role of differences among firms," Working papers 3715-94. CCSTR ; #173., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    7. Erik Brynjolfsson & Lorin M. Hitt, 2000. "Beyond Computation: Information Technology, Organizational Transformation and Business Performance," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 23-48, Fall.
    8. Fumio Hayashi & Edward C. Prescott, 2004. "The 1990s in Japan: a lost decade," Chapters, in: Paolo Onofri (ed.), The Economics of an Ageing Population, chapter 2, Edward Elgar Publishing.
    9. Dale W. Jorgenson & Kevin J. Stiroh, 2000. "Raising the Speed Limit: U.S. Economic Growth in the Information Age," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 31(1), pages 125-236.
    10. Zvi Griliches, 1998. "Productivity, R&D, and the Data Constraint," NBER Chapters, in: R&D and Productivity: The Econometric Evidence, pages 347-374, National Bureau of Economic Research, Inc.
    11. Price Statistics Division, 2001. "Quality Adjustment of Price Indexes -- Wholesale Price Index and Corporate Service Price Index: The Current Situation and Future Implications," Bank of Japan Working Paper Series Research and Statistics D, Bank of Japan.
    12. Fumio Hayashi & Edward C. Prescott, 2002. "The 1990s in Japan: A Lost Decade," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 5(1), pages 206-235, January.
    13. Alessandra Colecchia & Paul Schreyer, 2002. "ICT Investment and Economic Growth in the 1990s: Is the United States a Unique Case? A Comparative Study of Nine OECD Countries," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 5(2), pages 408-442, April.
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    More about this item

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D30 - Microeconomics - - Distribution - - - General
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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