September 11, 2014
A NYT editorial on Japan’s economy may have created false alarms by noting that its economy shrank at a 7.2 percent annual rate in the second quarter. This is true, but it is important to point out this plunge followed a first quarter in which it grew at a 6.0 percent annual rate. The net for the first two quarters is still negative, and the editorial is correct to raise warnings about the impact of sales tax increases on growth, but the picture is not nearly as dire as the second quarter figure taken in isolation suggests.
While the piece also reasonably calls for Japan to remove obstacles to women working and to advancing in the corporate hierarchy, it is worth noting that the country has already made substantial progress in this area. According to the OECD, the employment rate for prime age women (ages 25-54) is actually somewhat higher in Japan than in the United States, 71.4 percent in Japan compared to 69.9 percent in the United States.
Comments