Making economic growth and well-being compatible: evidence from Japan

Sarracino, Francesco and O'Connor, Kelsey J. and Ono, Hiroshi (2019): Making economic growth and well-being compatible: evidence from Japan.

Abstract

Whether economic growth improves the human lot is a matter of conditions. We focus on Japan, a country where reforms in the mid-1990s shifted the country from a pattern of rampant economic growth and stagnant well-being, to one of modest growth and increasing well-being. We discuss the policy reforms and analyze the changes that explain the increase in well-being. In particular, we assess whether the factors that explain the increase are consistent with those expected from the reforms. We apply Blinder-Oaxaca decomposition to World Values Survey data. Results show that well-being increased due to improved conditions for elderly people, people with children, and women, in other words, the primary groups targeted by the reforms. We conclude that adopting a system of social safety nets contributes to make economic growth compatible with increasing well-being over time.

• Item Type: MPRA Paper
• Language: English
• Keywords: Life satisfaction, Japan, inclusive growth, Blinder-Oaxaca decomposition, World Values Survey, social safety nets, welfare state
• Subjects: D - Microeconomics > D6 - Welfare Economics; D - Microeconomics > D6 - Welfare Economics > D60 - General; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty > I31 - General Welfare, Well-Being; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty > I38 - Government Policy ; Provision and Effects of Welfare Programs; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O12 - Microeconomic Analyses of Economic Development

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