Problems and Policies
ESRI Studies Series on Ageing
Edited by Koichi Hamada and Hiromi Kato
Chapter 6: Ageing Society and the Choice of Japan: Migration, FDI and Trade Liberalization
Junichi Goto 1. INTRODUCTION As the Japanese population is rapidly ageing, it is expected that Japan will face a serious labor shortage in the near future. It is often pointed out that, in order to cope with such a labor shortage, Japan should open the door to international migration. It is also pointed out that the increased migration to Japan would also beneﬁt sending countries through remittance and employment creation. However, as I wrote elsewhere (see Goto, 1993), in order to realize the same positive eﬀects, there are various alternatives to international migration. For example, the increased labor participation of Japanese women would relieve the expected labor shortage. Further, instead of accepting huge numbers of workers migrating from abroad, Japan could utilize foreign labor indirectly by increasing outgoing FDI and/or by reducing trade restrictions on labor-intensive imports (that is, movement of ‘money’ and/or ‘goods’ rather than the movement of ‘people’). In view of the above, in the present study, I will investigate, both theoretically and empirically, the merits and demerits of the international movements of labor, capital and goods, and their implications for the ageing society in Japan. I will investigate what kind of policy measure is most desirable for Japan and labor-sending countries. In the next section, I will brieﬂy examine the ageing issue in Japan. The Japanese population is rapidly ageing and the fertility rate is steadily declining. In view of this, it is widely argued that, in order to cope with a possible labor...
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