Research, Analyze and Present Past and Present Economic Data About Japan

Economic Background of Japan
The economy of Japan is among the top largest economies of the globe in
fact, it is the third biggest economy in the world after USA and China
(Iyoda, 2010). The chief exports of the country include electronic
devices, computers and cars. The most vital trade partners include the
USA and China, followed by Korea, Hong Kong, Taiwan, Thailand,
Singapore, and Germany. In its import/export balance, Japan economy has
a surplus. The most essential import goods to the country include raw
materials like wood, foodstuffs and oil. Besides, Japan’s major
industries manufacturing, construction, real estate, communication,
services, and distribution.
Demographics
The Japan’s total population was last recorded in 2012, where the
population was 127.5 million people this number increased from 83.2
million which was the population recorded in 1950. The population
represents 1.83% of the entire population of the globe (Hofmann, 2010).
This implies that one person out of every 55 people on earth resides in
Japan (The world bank, n.d). The graph showing the total population of
Japan for the past 10 years is as follows
The age structure of Japan is as follows
0-14 years: 13.5% (male 8,927,803/female 8,268,937)
15-24 years: 9.8% (male 6,385,033/female 6,046,609)
25-54 years: 38.5% (male 24,299,387/female 24,686,224)
55-64 years: 14.4% (male 9,166,111/female 9,177,111)
65 years and over: 23.9% (male 13,097,558/female 17,313,315) (2012 est.)
Gross domestic product (GDP)
The GDP describes the monetary value of the entire finished
commodities and services produced within the borders of a given country
for a specified period. The GDP for Japan has been increasing for the
past 10 years. In the year 2000, the GDP for Japan stood at US$ 4430
billions while in 2013, it stands at US$ 5960 billions. This shows an
increase in GDP for the past 10 years however, the increase has not
been consistent from year to year. There have been a decrease in GDP in
between some years. In between 2000 and 2001, the GDP increased from US$
4430 billions to US$ 4730 billions before decreasing in 2002 and 2003.
It then increased between 2004 and 2005 after which it decreased again
from 2006 to 2008. But the GDP has been increasing from 2009 through
2013 (The world bank, n.d). The following graph indicates the GDP of
Japan for the past 10 years
The GDP growth rate in Japan has been increasing and
decreasing for the past 10 years. The GDP growth rate decreased the most
in between 2008-2009, but was the highest in 2012. The chart below
indicates the GDP growth rate for the past 10 years
The GDP per capita in Japan is estimated to be equal to 298 % of the
globe’s average. The following chart illustrates the GDP per capita
for Japan for the past 10 years
Unemployment rate
Unemployment rate refers to the total labor force, which is unemployed
but willing to work and actively seeking employment. The higher the rate
of unemployment in a country, the slower the rate of economic growth.
Part of the Japan population is not employed the unemployment rate for
the past 10 years indicates that the unemployment rate has ranged
between 3.6% and 5.5%. The unemployment rate was the highest between
2002 – 2004 and between 2009-2010. However, the rates decreased
drastically between 2004-2009. In fact, it reached its lowest percentage
in between 2007-2008. The following chart illustrates the unemployment
rate of Japan for the past 10 years
The youth unemployment rate is increasing, which indicates that the
country has a problem in youth unemployment (Iyoda, 2010). The following
chart indicates the youth unemployment rate for the past 10 years
The Exchange Rate
The exchange rate refers to the worth of a country’s currency
expressed in another country’s currency. In other words, the exchange
rate describes the rate at which a certain currency can be exchanged for
another. For example, the rate at which the Japanese Yen can be
exchanged to the Great Britain Pound. According to the historical data,
the exchange rate between the Japanese Yen against the US$ indicates
that the Japanese Yen is not favored against the US$. The exchange rate
has indicated that for the past 10 years, the Japanese Yen has shown
promising results for the past five years since it has emerged as
gaining strength. The following chart indicates the exchange rate of the
Japanese Yen against the US$ for the past 10 years
Source: HYPERLINK “http://www.tradingeconomics.com/japan/currency”
http://www.tradingeconomics.com/japan/currency
Business Cycle / Level of Economic Growth
The level of economic growth describes a measure of the performance of
the economy from one period to another this measure is not usually
adjusted for inflation, but is usually expressed in nominal terms.
Because of the level of inflation, the level of economic growth has been
fluctuating. During the periods of high inflation rates, the economic
growth level of Japan has been exceedingly low this is because the
level of inflation influences the level of economic growth. The
following chart shows the level of inflation and the level of economic
growth in the past years
Through relating the rate of inflation to the level of economic growth,
it is evident that the level of economic growth changes as the rate of
inflation changes. When the rate of inflation is high, the level of
economic growth is low and vice versa.
Consumer Spending Patterns
Consumer spending describes the amount of resources spent by households
in a given economy. The spending entails durables and nondurables
consumer spending is usually measured monthly. According to John Maynard
Keynes, consumer spending is vital in determining short term demand in a
given economy. According to the consumer spending data, it is apparent
that the pattern of consumer spending has been increasing for the past
10 years (www.tradingeconomics.com). This can be attributed to the
inflation rate experienced in the past 10 years and the exchange rate
system. When the inflation rate is exceedingly high, the level of
consumer spending is likely to be exceedingly high the same case
applies, when the exchange rate is exceedingly high. The following chart
shows the pattern of consumer spending for the past 10 years
Investment Patterns
Investment refers to property or another possession that is usually
acquired for future financial benefit or return. The engagement of Japan
in investment includes foreign bond investment, foreign stock investment
and foreign direct investment. According to the foreign bond investment
data, it is apparent that the foreign bond investment has not been
consistent but has been fluctuating. Besides, the foreign stock
investment patterns are also not consistent since they have been
fluctuating for the past 10 years. However, the foreign direct
investment depicts an increasing trend for the past 10 years. The
following charts show the investment patterns in Japan
Government Expenditures
Government expenditure refers to the resources that the government
utilizes at a given period to facilitate the running of government
operations. According to the government spending data, the government
spending has been increasing in the past 10 years
(www.tradingeconomics.com). One of the probable reasons for the
increasing pattern of the government spending is due to the increasing
responsibility of the government in providing public goods. Besides, the
inflation rate has been increasing, which implies that the cost of
services paid for by the government is likely to hike up due to
inflation. The following chart depicts the government spending pattern
for the past 10 years
Net exports
Net exports refers to the total exports in a given economy less total
imports in the economy. The value of net exports is crucial to an
economy since it helps in determining the benefit that a country
receives from the involvement in trade. The higher the value of net
exports, the higher the benefit that a country is likely to receive from
an international trade. The value of net exports is vital in determining
the balance of trade whenever, net export value is negative, there is a
deficit in the balance of trade. On the other hand, when the value of
net export is positive, it implies that there is a surplus in the
balance of trade. However, when the value of net export is equal to
zero, then there is a balanced balance of trade
(www.tradingeconomics.com). The net exports have remained positive for
most of the years, in the last 10 years however, it has approached
exceedingly high negative values for the past 3-4 years. The following
chart shows the value of net exports for the past 10 years.
Source: HYPERLINK
“http://www.tradingeconomics.com/japan/balance-of-trade”
http://www.tradingeconomics.com/japan/balance-of-trade
According to the economic data for Japan, the country has an opportunity
of making better its economic growth. First, the country needs to
improve its foreign investment since the level of foreign investment is
low. Through enhancing its foreign investments, the country will be
capable of receiving additional revenues that it can use in facilitating
government expenditures. This is vital for the country’s economic
growth since additional revenues will aid the country in eliminating
some problems that may hinder economic growth. Besides, through
enhancing the foreign investment, the country will be capable of
influencing the exchange rate system, which will help the country in
trade. This is likely to favor the country in terms of trade leading to
economic growth.
Another way that the country can better its economic growth is through
increasing the number of exports as it reduces the number of imports.
This is critical since it will help the country in enhancing its balance
of trade. The country is likely to have a surplus if it increases its
exports and decreases its imports. This will better the economic growth
of the country since the resources that the country could have used in
imports will be utilized in eradicating issues such as illiteracy, which
may hinder economic growth. Besides, another way of making the country
better its economic growth is through reducing the rate of unemployment.
A reduction in the rate of unemployment is likely to increase
productivity since the population providing labor increases. An increase
in the country’s productivity will increase the GDP of the country and
enhance the living standards of a vast number of citizens in the country
leading to an enhancement of the economic growth of the country.
High unemployment is risky for a country since it can lead to a country
lagging behind in economic growth. When there is high unemployment, it
implies that a vast population of the entire population is not employed
meaning they are not capable of affording most of services and
commodities. Because of their low affordability, the vast population is
likely to depend on the government for the provision of essential
services and commodities. Due to the high population under unemployment,
the government is likely to use more resources in providing for the
population, which affects the government spending. An exceedingly high
government spending is likely to overload the government leading to a
failure in government in achieving economic growth. Besides,
unemployment is likely to lead to social problems such as crime and low
literacy rates, which a key hindrance to the achievement of economic
growth. Therefore, due to the economic problems associated with high
levels of unemployment, it is critical for a country to be worried by
high rates of unemployment.
The rate of employment can be improved through the government utilizing
the fiscal policy. Since the fiscal policy focuses on using the
government spending and taxation in influencing the economy, the
government can resolve the issue of unemployment through the fiscal
policy. The policy should focus on increasing the government spending in
order to provide an avenue for people becoming employed. For instance,
through the government increasing its spending, it can be capable of
providing funds that the unemployed individuals can utilize in creating
self employment. Besides, the government can set aside some funds, which
the unemployed individuals can borrow in order to help them in acquiring
employment. This will help in reducing the unemployment level since the
funds set aside by the government will aid more and more individuals in
becoming employed through starting small businesses, or employing other
individuals who are not employed.
Conclusion
Through using the economic data of Japan, it is apparent that the youths
are facing a problem in employment. This emanates from the high rate of
youths that are unemployed the country needs to improve its employment
rate in order to improve its opportunity of making better its economic
growth. Although the country is the third in the entire globe, in terms
of GDP, it needs to enhance its employment rate especially for the
youths in order to achieve even greater heights of economic development.
High unemployment is risky for the country since it can lead to a
country lagging behind in economic growth. When there is high
unemployment, a vast population of the entire population is not employed
meaning they are not capable of affording most of services and
commodities. Because of their low affordability, the vast population is
likely to depend on the government for the provision of essential
services and commodities. The country can deal with the problem of
unemployment through utilizing the fiscal policy. On the other hand, the
country needs to increase its exports in order to enhance the balance of
trade, which will aid the country in achieving more revenues crucial for
achieving high rates of economic growth.
References
Japan Economic Indicators (n.d). Trading Economics, Retrieved from
HYPERLINK “http://www.tradingeconomics.com/japan/indicators”
http://www.tradingeconomics.com/japan/indicators
The world bank (n.d). World Development Indicators, Retrieved from
HYPERLINK “http://data.worldbank.org/country/japan”
http://data.worldbank.org/country/japan
Iyoda, M. (2010). Postwar Japanese economy: Lessons of economic growth
and the bubble economy. New York: Springer.
̈nchen: GRIN Verlag GmbH.
RESEARCH, ANALYZE AND PRESENT PAST AND PRESENT ECONOMIC DATA ABOUT JAPAN
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RESEARCH, ANALYZE AND PRESENT PAST AND PRESENT ECONOMIC
DATA ABOUT JAPAN