Productivity profile of Japan

Council of New Form of Capitalism Realization (CNFCR) (website in Japanese): The CNFCR is an advisory council to the Prime Minister that was founded in October 2021. The Prime Minister is the chair of the Council, which consists of six ministers and sixteen private-sector experts (two academic experts and fourteen business persons). The Council does not have an English website, but its meetings are reported on the Prime Minister’s website. 

Council on Economic and Fiscal Policy (CEFP): The CEFP is a statutory advisory body to the Prime Minister on economic and fiscal policy management that was founded in January 2001. The Prime Minister is the chair of the Council, which consists of five ministers, the governor of the Bank of Japan and four private-sector experts (two from academia and two from the business sector). The Council drafts the Cabinet’s annual Basic Policy on Economic and Fiscal Management and Reform, which articulates priorities of budget, tax and structural reforms of the year.

Council for Promotion of Regulatory Reform (CPRR): The Council is a statutory advisory body to the Prime Minister that was established in October 2019 as a permanent body, succeeding the role of the predecessor councils that were installed by temporary cabinet orders in every three years. The CPRR consists of 9 members from the business sector, academia and research institutes. Its mandate is to review and deliver an annual report on recommendations of regulatory reforms, which is to be endorsed as a cabinet decision that binds all relevant government agencies.

Cabinet Office: Basic Policy on Economic and Fiscal Management and Reform (2021), Economic Measures (multiple), Report on Promotion of Regulatory Reform (multiple) in Japanese, Annual Report on the Japanese Economy and Public Finance (multiple);

Cabinet Secretariat: Grand Design and Action Plan for a New Form of Capitalism 2023 Revised Version (2023);

Economic and Social Research Institute (ESRI): Discussion Paper Series, Working Paper Series, Identification and Estimation of Production Function with Unobserved Heterogeneity (2022), The Effect of AI on Wages in Japan Using Computable General Equilibrium Model (2022), The impact of data management and organizational structure on AI utilization: Empirical analysis using JP-MOPS data (2021), The Impact of Data Activities on Innovation Performance in Service Industries (2021), How does innovation derive from the effective use of data and management skills? Evidence from JP-MOPS data for the Japanese wholesale sector (2020), Management practices meet labour market outcomes (2019);

Research Institute of Economy, Trade and Industry (RIETI): Discussion Paper Series, RIETI - Estimating Firm-level Production Functions with Spatial Dependence in Output, Input, and Productivity (2023), RIETI - CEO Age, Firm Exit and Zombification amidst the COVID-19 Pandemic (2023), What Do R&D Spillovers from Universities and Firms Contribute to Productivity? Plant level productivity and technological and geographic proximity in Japan (2022), Does Industry Agglomeration Attract Productive Firms? The role of product markets in adverse selection (2022), The Effect of Uncertainty on Entrepreneurial Activity (2022), Productivity Dynamics of Work from Home since the Onset of the COVID-19 Pandemic: Evidence from a panel of firm surveys (2022), Enhancing Team Productivity through Shorter Working Hours: Evidence from the Great Recession (2021);

OECD: OECD Economic Surveys: Japan (multiple), Economic Policy Reforms 2023: Going for Growth - Japan, Mission-oriented innovation policy in Japan (2021), Creating Responsive Adult Learning Opportunities in Japan (2021), Structural adjustment and changes to employment use in Japan (2020), Labour market reform in Japan to cope with a shrinking and ageing population (2019).

Boost productivity growth by strengthening smaller firms:

• Promote the consolidation of managerial resources in viable SMEs by strengthening regulatory incentives for venture capital, and mergers and acquisitions deals.
• Make the R&D tax credit refundable or reinstate the tax carry-over to enhance incentives to invest by innovative start-ups and early-stage SMEs.

Promote a competitive business environment by creating a favourable investment climate and spurring business dynamism:

Continue to lower barriers to inward FDI by reducing explicit restrictions and activating the market for M&As.

• Spur business dynamism by further lowering the coverage rate of public loan guarantees to incentivize banks improving their credit risk management.

Enhance labour mobility between businesses, universities, and public research institutions to spur R&D.