Japanese Structural Adjustment and the Balance of Payments
NBER Working Paper No. 2614
Issued in June 1988
NBER Program(s):International Trade and Investment, International Finance and Macroeconomics
Policy discussions in Japan have increasingly recognized the important role of land values and land-use patterns in Japanese macroeconomic adjustment. In Japan in recent years, land wealth constitutes more than half of financial wealth, a proportion that is much higher than in the United States and other industrialized economies. Consequently, shifts in land-use patterns can have important effects on Japanese savings and investment patterns, and thereby on the Japanese trade balance and current account. This papers studies the implications of land-use policies for the Japanese macroeconomy using both a theoretical model and a multi- sectoral dynamic simulation model.