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Japan may not be the ideal economic model. In the 1980s, Japan had an enormous economic bubble. (This was the period when MITI, the Ministry of International T

Japan may not be the ideal economic model. In the 1980s, Japan had an enormous economic bubble. (This was the period when MITI, the Ministry of International Trade and Industry, was the ultimate Platonic ideal of how to run a country's economy and the Japanese Fifth Generation computing project was going to eliminate "programming" as a job category.) This bubble burst in 1990-1991. It was bad. "GDP fell from $5.33 trillion to $4.36 trillion in nominal terms, real wages fell around 5%,... Many Japanese companies replaced a large part of their workforce with temporary workers, who had little job security and fewer benefits. As of 2009, these non-traditional employees made up more than a third of the labor force. For the wider Japanese workforce, wages have stagnated. From their peak in 1997, real wages have since fallen around 13%..[as of 2013]." https://en.wikipedia.org/wiki/Lost_Decade_(Japan) https://en.wikipedia.org/wiki/Lost_Decade_(Japan) "Japan's annual land prices averaged nationwide have finally risen since the asset bubble collapse, though only mildly at 0.1%, a process that has taken 26 years to show up statistically. [undated] "By 2004, prime "A" property in Tokyo's financial districts had slumped to less than 1 percent of its peak, and Tokyo's residential homes were less than a tenth of their peak,... "The Nikkei 225 at the Tokyo Stock Exchange plunged from a height of 38,915 at the end of December 1989 to 14,309 at the end of August 1992. By 11 March 2003, it plunged to the post-bubble low of 7,862." https://en.wikipedia.org/wiki/Japanese_asset_price_bubble https://en.wikipedia.org/wiki/Japanese_asset_price_bubble "After a long climb during the decades of Japan’s economic miracle, prices exploded in the late eighties in the frenzy of the bubble economy. Over the following decade, prices collapsed by over 80%, hitting a low in 2002. Since then however, prices have increased and we are not in the middle of a stable period of growth with a positive outlook for the future." https://housingjapan.com/buy/history/ https://housingjapan.com/buy/history/ [I note: "Housing Japan is the leading real estate agent for international clients looking to rent, buy or invest in the Tokyo property market."] "Tokyo’s property market has had its ups and downs. At the peak of the bubble in 1989, some condos were selling for more than 1 billion yen, and buildings with more than 30 floors started springing up. "After the bubble, prices plummeted. In 2002, the price per tsubo was about half that of the bubble era. But easier housing loans and low interest rates helped spur demand for new condos." https://asia.nikkei.com/Business/Markets/Property/Tokyo-property-prices-near-bubble-era-levels https://asia.nikkei.com/Business/Markets/Property/Tokyo-prop... [Has a nice graph of Tokyo condo prices, per-tsubo (3.3 sq. meters).]

bsanr2 7y ago
This needs to be taken within the context of Japan hosting one of the largest economies in the world, despite being substantially smaller in population than countries with economies of comparable size; and also in that their real wage losses 1) pale in comparison to America's, and 2) mean that their real wages are still much higher than most of the world's. I've heard it put that Japan's economy makes it relatively easy to live a stable middle class lifestyle, though almost impossible to accrue substantial wealth. I understand why this may seem horrifying to some, but looking at the relative affluence of the average Japanese compared to the average American, I don't see their situation as particularly dire.
- iateanapple 7y ago
  > I've heard it put that Japan's economy makes it relatively easy to live a stable middle class lifestyle Agreed. If they fixed up their lack of work/life balance it would be a workers paradise.
- adventured 7y ago
  > despite being substantially smaller in population than countries with economies of comparable size Which countries would that be? There are very few with economies of comparable size. The next above Japan is nearly three times larger (China). Besides, it's super easy to avoid that GDP / population confusion by looking at GDP per capita. The US GDP per capita figure ($65,111) for 2019 was 59% higher than Japan ($40,846), which has been tumbling down the per capita rankings for 25 years. For reference, in 1995 Japan's GDP per capita was $43,440, nearly the highest of any nation. The inflation adjustment on that is $74,600. So not only is Japan missing $34,000 just to break even on inflation, by contracting 6% over that time, they've actually shrank drastically in real terms. Since 1995 US GDP per capita has increased by about 127% by contrast, exceeding inflation by about $15,000. The other legitimate comparables: Germany is ~15% higher per capita, Britain and France are nearly the same (only slightly higher than Japan). In 1995 Japan had a GDP per capita 100% higher than Britain, now they're even. Japan ranks #19 on GDP per capita (excluding tiny nations like Luxembourg). > and also in that their real wage losses 1) pale in comparison to America's, and 2) mean that their real wages are still much higher than most of the world's. That's not even remotely close to being true. The US has outperformed Japan dramatically on both GDP per capita and incomes. At the end of 2019, real US wages (both median and average) were at new all-time highs, according to the Federal Reserve. The full-time median income in the US hit near $50,000 for 2019, Japan doesn't come close to that. Japan's peak on real incomes was hit 25 years ago. They've lost about 1/3 of their real personal income since then. Japan went from having one of the highest income figures, to struggling to remain in the top 20. US wages remain among the highest of any nation (including on disposable incomes), comparable only to countries like Sweden, Switzerland, Denmark and Norway. Here are the average wages in the OECD. Japan ranks about 10% below the OECD average. The US is dramatically higher, ranking just behind Switzerland. https://data.oecd.org/earnwage/average-wages.htm https://data.oecd.org/earnwage/average-wages.htm Here is the OECD better life index page on incomes: http://www.oecdbetterlifeindex.org/topics/income/ http://www.oecdbetterlifeindex.org/topics/income/ Japan ranks in the middle of the pack, the US ranks at the front of the pack. Here is the Wikipedia page on median incomes: https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income Japan again ranks well behind the US, and on disposable income ranks dramatically far behind the US. More: https://en.wikipedia.org/wiki/List_of_countries_by_average_wage https://en.wikipedia.org/wiki/List_of_countries_by_average_w... https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income https://en.wikipedia.org/wiki/Disposable_household_and_per_c...

bsanr2 7y ago

This needs to be taken within the context of Japan hosting one of the largest economies in the world, despite being substantially smaller in population than countries with economies of comparable size; and also in that their real wage losses 1) pale in comparison to America's, and 2) mean that their real wages are still much higher than most of the world's. I've heard it put that Japan's economy makes it relatively easy to live a stable middle class lifestyle, though almost impossible to accrue substantial wealth. I understand why this may seem horrifying to some, but looking at the relative affluence of the average Japanese compared to the average American, I don't see their situation as particularly dire.

iateanapple 7y ago
> I've heard it put that Japan's economy makes it relatively easy to live a stable middle class lifestyle Agreed. If they fixed up their lack of work/life balance it would be a workers paradise.
adventured 7y ago
> despite being substantially smaller in population than countries with economies of comparable size Which countries would that be? There are very few with economies of comparable size. The next above Japan is nearly three times larger (China). Besides, it's super easy to avoid that GDP / population confusion by looking at GDP per capita. The US GDP per capita figure ($65,111) for 2019 was 59% higher than Japan ($40,846), which has been tumbling down the per capita rankings for 25 years. For reference, in 1995 Japan's GDP per capita was $43,440, nearly the highest of any nation. The inflation adjustment on that is $74,600. So not only is Japan missing $34,000 just to break even on inflation, by contracting 6% over that time, they've actually shrank drastically in real terms. Since 1995 US GDP per capita has increased by about 127% by contrast, exceeding inflation by about $15,000. The other legitimate comparables: Germany is ~15% higher per capita, Britain and France are nearly the same (only slightly higher than Japan). In 1995 Japan had a GDP per capita 100% higher than Britain, now they're even. Japan ranks #19 on GDP per capita (excluding tiny nations like Luxembourg). > and also in that their real wage losses 1) pale in comparison to America's, and 2) mean that their real wages are still much higher than most of the world's. That's not even remotely close to being true. The US has outperformed Japan dramatically on both GDP per capita and incomes. At the end of 2019, real US wages (both median and average) were at new all-time highs, according to the Federal Reserve. The full-time median income in the US hit near $50,000 for 2019, Japan doesn't come close to that. Japan's peak on real incomes was hit 25 years ago. They've lost about 1/3 of their real personal income since then. Japan went from having one of the highest income figures, to struggling to remain in the top 20. US wages remain among the highest of any nation (including on disposable incomes), comparable only to countries like Sweden, Switzerland, Denmark and Norway. Here are the average wages in the OECD. Japan ranks about 10% below the OECD average. The US is dramatically higher, ranking just behind Switzerland. https://data.oecd.org/earnwage/average-wages.htm https://data.oecd.org/earnwage/average-wages.htm Here is the OECD better life index page on incomes: http://www.oecdbetterlifeindex.org/topics/income/ http://www.oecdbetterlifeindex.org/topics/income/ Japan ranks in the middle of the pack, the US ranks at the front of the pack. Here is the Wikipedia page on median incomes: https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income Japan again ranks well behind the US, and on disposable income ranks dramatically far behind the US. More: https://en.wikipedia.org/wiki/List_of_countries_by_average_wage https://en.wikipedia.org/wiki/List_of_countries_by_average_w... https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income https://en.wikipedia.org/wiki/Disposable_household_and_per_c...