Template-type: ReDIF-Paper 1.0
Author-Name: Toshihiro Ihori
Author-Name-First: Toshihiro
Author-Name-Last: Ihori
Author-Workplace-Name: University of Tokyo
Author-Workplace-Homepage: http://www.u-tokyo.ac.jp/
Author-Name: Ryuta Ray Kato
Author-Name-First: Ryuta
Author-Name-Last: Kato
Author-Email: kato@iuj.ac.jp
Author-Workplace-Name: International University of Japan
Author-Workplace-Homepage: http://www.iuj.ac.jp/
Author-Name: Masumi Kawade
Author-Name-First: Masumi
Author-Name-Last: Kawade
Author-Workplace-Name: Niigata University
Author-Workplace-Homepage: http://www.niigata-u.ac.jp/
Author-Name: Shun-ichiro Bessho
Author-Name-First: Shun-ichiro
Author-Name-Last: Bessho
Author-Workplace-Name: Hitotsubashi University
Author-Workplace-Homepage: http://www.hit-u.ac.jp/
Title: Public Debt and Economic Growth in an Aging Japan
Abstract: This paper examines the effects of the demographic change and the government debt policy in Japan on economic growth and economic welfare, particularly by taking into account the existing public pension scheme as well as national medical expenditure through the existing public health insurance, where a computable overlapping generations model is used within a general equilibrium context. One of the main results of this paper is that the tax burden (GDP) ratio will increase up to about 36%, and the social security burden (GDP) ratio will increase up to 23.3% in 2050, even though the government tries to have a positive primary balance by 2010. The ratio of public health insurance benefits to GDP is expected to increase at 1% every 10 years, and the ratio will be around 9.6% in 2050. The 2004 public pension reform will successfully result in a 13 point decrease in the contribution rate from 36.44% to 23.53%, and reduce the social security burden (GDP) ratio by about 8 points from 23.27% to 15.02% in 2050, compared with the benchmark case.
Classification-JEL: H55, E27
Length: 46 pages
Creation-Date: 2006-08
Number: EMS_2006_11
File-URL: https://www.iuj.ac.jp/workingpapers/index.cfm?File=EMS_2006_11.pdf
File-Format: Application/pdf
File-Function: First version, 2006
File-Size: 372KB
Keywords: Words: Government Deficits, An aging Population, Public Pension Scheme, Public Health Insurance, Intergenerational Redistribution, Overlapping Generations Model, Simulation
Handle: RePEc:iuj:wpaper:EMS_2006_11