Press "Enter" to skip to content

Information Technology and the Japanese Economy

Jorgenson and Motohashi’s paper looks at how the role information technology affects economic growth in Japan and the United States.  The percentage of Japanese GDP devoted to investment in computer technology rose sharply after 1995.  This investment parallels the growth of IT investment in the United States.  While investment in IT has been similar, growth from non-IT investment has trailed the United States’ growth.  As the authors mentioned in the paper, I would be interested to see a microeconomic analysis of IT investment on the firm level.  This might allow for better insight and a more complete story of the macroeconomic trends written about in this paper.

One Comment

  1. In many ways Japan lags in implementing IT at the firm level. The same is true at “generic” firms in many other technical areas including finance. In the background are personnel systems that favor generalists in recruitment and promotion. My own experience is with banks and steel companies and car dealerships. The latter, for example, typically have a prefecture as an exclusive sales area since it is hard to register a car bought in one prefecture in another prefecture. So a dealership may have 80 sales points, more like a dealership group in the US but typically managed as a single enterprise. Someone running sales, however, has to rotate to service at some point if they want to see their pay rise. Not everyone is suited for such. Ditto IT: while the nitty-gritty will be contracted out, the boss will rotate and may be someone with little knowledge. So the micro side is consistent with the macro: less gains than in the US.

Comments are closed.