Japan's end of history

By Razib Khan | October 16, 2010 10:19 pm

A rather depressing piece in The New York Times, Japan, Once Dynamic, Is Disheartened by Decline:

But perhaps the most noticeable impact here has been Japan’s crisis of confidence. Just two decades ago, this was a vibrant nation filled with energy and ambition, proud to the point of arrogance and eager to create a new economic order in Asia based on the yen. Today, those high-flying ambitions have been shelved, replaced by weariness and fear of the future, and an almost stifling air of resignation. Japan seems to have pulled into a shell, content to accept its slow fade from the global stage.

Yet Japan’s demographic and economic stagnation seems to be the ultimate likely outcome if Z.P.G. activists get their way. All things equal if I had to pick between being a citizen of a dynamic but poor society or a stagnant but rich one, I’d go with the latter. The moral of the article is that Japan’s fate may await Western nations, but is affluent ennui that bad? Perhaps we are destined to become as the citizens of Diaspar.

The New York Times gives an impressionistic sense of Japanese decline, and relies on the perceptions of the Japanese themselves. But let’s look at some numbers. Below are some plots from Google Data Explorer with national aggregate statistics. They’re comparing Japan, the USA, and Germany, over time.

MORE ABOUT: End of History, Japan

Comments (20)

  1. Zohar

    Razib, one of the things I most appreciate about your blog is your use of graphs, charts, and tables to great effect. However, in this post, I found the switching of colors between the 3 countries to be unnecessarily confounding. Wouldn’t it be possible to be consistent in all the charts?

  2. google data explorer produced the charts. i agree it’s a problem, but if you refresh, the colors will change. i don’t control it.

  3. Zohar

    I vaguely suspected that there may be some racial sensitivity issue by not having the Japanese as “yellow,” but you don’t strike me as that kind of guy. Carry on!

  4. bioIgnoramus

    The road fatalities one is interesting. I suppose people will explain it away in terms of miles driven.

  5. dave chamberlin

    It will be interesting to see the impact of the latest recession and where it hardest when these graphs become updated to 2010. The one sterotype these graphs destroyed for me is that Japanese work harder than Americans. They did, but no more.

  6. free thinker

    Judging by the way per capita GDP for Japan jumps around, I assume that you are using nominal GDP in the numerator. and that the big swings in the number are artifacts of the exchange rate. A figure based on Purchasing Power Parity would have produced a smoother and more informative graph.

    Looking at these graphs as a whole, it is easy to see where our ruling elites are coming from. They have decided that because America has a mature economy with a saturated consumer sector it will be hard to grow per capita GDP fast enough to stay ahead of China. But aggregate GDP is also a function of population growth and this can be changed by controlling (or failing to control) immigration. I am opposed to this policy. I think our ruling elites underestimate the social problems we are importing by fostering mass immigration from third-world countries, but it is a defensible plan. If the goal is to keep America the number one economic and military power in the world for another century, then they are probably doing the right thing.

  7. I’m trying to keep to the comment rules and not post irrelevant comments but Diaspar was a trigger and can’t help myself.

    I have just spent the summer reading Arthur C. Clarke; I’m struggling on on the 9th book. Sand of Mars, this has taken a while to finish but this post might be the impetus to continue through the slog.

    Btw on Japan; demographics are not destiny, not anymore. The West and developed world should just stick to 3 points to facilitate growth once more.

    (1.) Free trade
    (2) Free transfer of capital
    (3.) Free movement of people

    I just cannot grasp why there are internal barriers between Western and developed nations; makes no sense.

    Either way after more than a decade in London; mass immigration is working and we are assimilating the new comers. The West and Japan may darken their hues somewhat (as the Italians, Persians and other Great Empires have arguably done over the past couple millennia) but its not a *decline* in any real way. The culture and the essence of the people linger on; have the Puritan and the Founding Fathers diminished in any way after majority American no longer descends from pre-1790 population?

    Ps: Just read the other post on the America and Anglo revolution from way back in July http://blogs.discovermagazine.com/gnxp/2010/07/the-anglo-revolutions/. Weighty stuff

  8. kurt9

    Having lived in Japan during the 90’s as well as being married to a Japanese, I will comment on this. Japan is stagnant, but life is not bad there. The main problem with Japan is that it remains a very crowded place with people living in crackerjack-sized apartments and condos. The trains in the Tokyo area are crowded as well, still crowded even though they have built several new train lines since I left in 2000.

    Japan had essentialy zero economic growth for 12 years following the crash of their bubble (from 1992 until 2004). From 2004 until the Lehman shock in September 2008, Japan actually averaged 2.5% growth per year during that time. This is during a time when their total population is actually decreasing and their working population decreasing even faster. In other words, 2.5% economic growth in Japan is probably like 4-5% here in the U.S. This is not bad at all. There was actually a lot of employment opportunity for young people during this 5 year period.

    Japan’s economy took the hit in September of ’08 specifically because of the collapse of the carry trade, not because of structural or other issues. The collapse of the carry trade forced a massive appreciation of the Yen relative to the Dollar such that Japanese exports collapsed by around 70% (this is nasty). Hence, Japan’s economy contracted 15% in late ’08 and through out ’09. Their economy is now on the mend.

    It is true that a declining population (and aging one) does not produce the kind of collective dynamism that NY Times writers like to chant about. However, there is considerable technological innovation going on in Japan, especially in robots. Also, need I remind you that the Japanese are way ahead of everyone else in hybrid auto technology (50% of all cars sold in Japan are hybrids)?

    Pundits talk about the problems of a declining population. However, there are upsides to it as well. A declining workforce population makes it easier to liberalize economies without the burden of temporary unemployment that such liberalization creates when protected cartelized industries are deregulation. Liberalization of economic sectors can be done in lockstep with natural attrition of the workforce as they retire. China has benefited from this. The peaking and decline of China’s working age population will make it easier for the Chinese to shutdown the SOEs (state owned enterprises) without creating the mass unemployment pundits predicted 10 years ago.

    Countries with declining populations are less likely to wage war than those with expanding populations. This is something that should resonate with liberal NY Times readers.

    The biggest problem facing Japan is their huge government debt, which is 200% of GDP. This is going to be a disaster at some point in the future.

    “Yet Japan’s demographic and economic stagnation seems to be the ultimate likely outcome if Z.P.G. activists get their way.”

    Obviously. The brain of a typical Z.P.G. activist may be functional enough to realize this. Maybe.

    “All things equal if I had to pick between being a citizen of a dynamic but poor society or a stagnant but rich one, I’d go with the latter. “

    Of course. We all would.

    “The moral of the article is that Japan’s fate may await Western nations, but is affluent ennui that bad? Perhaps we are destined to become as the citizens of Diaspar.”

    Probably the whole world starting around 2050. Diaspar is not a bad deal. You get to live in a body that never grows old and get to party all you want. A damn sight better than what we currently have. Those who are into the pioneering thing can join the space movement and figure out how to build space craft and space colonies using 3-D fabber technology. Other than the pioneering thing, what is there to recommend in place of hedonism and affluent ennui?

  9. omar

    Has anyone read this book: http://www.amazon.com/Somebody-Elses-Century-Post-Western-ebook/product-reviews/B003E8AJ0G

    And what do you think of it? I have to run, but have some comments I will post later…

  10. Zora

    I don’t understand the hostility to ZPG. Current human population is long-term unsustainable absent HUGE increases in efficiency of energy use, recycling, and reforestation/soil reclamation/biodiversity protection. Those increases would depend on political will (which seems to be lacking) and scientific advances (which can’t be predicted).

    A journalist may claiming that you can’t have “dynamism” (whatever that is) without growth in GDP and population but that doesn’t make it true. The writer argues by anecdote rather than statistics. Yes, there are statistics for economic performance … none for dynamism.

  11. dave chamberlin

    I find the graph showing a fairly stable line on road fatalities in the United States since 1992 to be very strange. Cars are much safer now thanks to air bags and enforced seat belt laws, the DUI laws are being enforced with far greater penalties, and the population has gotten older. Maybe the comment by bioIgnoramous that people are driving more mile explains why fatalities per million people hasn’t decreased, but I doubt it. Gas prices have increased dramatically in this same time period, discouraging driving, and there has been a build up of office space far closer to the suburban homes of commuters. Perhaps our resident answer man will find this question interesting enough to look into further.

  12. omar

    I mentioned Patrick Smith’s book (Somebody else’s century) because it focuses on three Asian cultures (Japan, China and India) in its discussion of modernization and its discontents (real or imaginary) and he is fascinated by the Otaku phenomenon: all the weird pointlessly pointless obsessions that characterize a subset of Japanese people at the end of history. I am still in the middle of the book and will let you know what I think once I get through it, but I was wondering if people have insights to share about this phenomenon. Is it random noise? how important is it? Does it really tell us something about Japan or about the modern world? Smith rather proudly announces his disdain for”mere data” (as against “real understanding”), but on this data-driven blog, what do people think about him or his kind of arguments?

  13. omar

    I dont know any sophisticated ZPG advocates (I assume they exist), but I do know a lot of leftists and liberals who share a vague disquiet about humans burdening the poor planet. In my experience, this disquiet co-exists with the desire to see more humans survive and multiply, better health-care for all, preservation of ancient cultures, development of new cultures, world peace, guerrilla war and many other elements (some frankly contradictory to each other). But then again, similarly incoherent and contradictory positions are commonplace in the tea-party or the right wing or, for that matter, the most sophisticated Yalie Republicans…maybe that is why history won’t end after all…

  14. Zora

    Omar, you know me and I’m a ZPG advocate. I believe that I’m sophisticated. I’m not sure that I could be described as a leftist or liberal. My politics are … outlier.

    I find it disconcerting that you lump together ZPG advocates, leftists, and liberals together as if they were one organization and then criticize them for holding diverse views. I see no incoherence in wanting ZPG, environmental protection, health care, and world peace, all at once. Providing modern health care to underserved populations usually results in a population spike: decreased mortality + old pro-natalist lifeways. As populations urbanize and women get educations and jobs, birth rate drops — below replacement in many areas.

    I’m not rah-rah guerillas and I don’t want to see people being fruitful and multiplying. I’m not for preserving ancient cultures if that means dooming some people to live in ethnic theme parks. I am for studying and recording human cultures, whether they’re Burmese hill tribes or LA skate punks.

    In any case, it looks as if I’m going to win the argument in the long term, because the world population is expected to stabilize by 2050. I’m just concerned that it stabilize at a lower and sustainable figure.

    My own suggestion for doing so is the ZPG lottery. Women enter a lottery and win prizes, which they can only claim if they haven’t given birth in the last year. Randomly reward women for not giving birth! Not coercive, but probably effective.

  15. omar

    Zora, I am sure you are sophisticated and it does seem like world population may stabilize by 2050. I was stereotyping, but you must admit that while no particular person has to hold ALL the views I mentioned, they tend to cluster together in some people. Pesonally, I dont think a non-coercive program of population control makes much difference. I think it happens once a society transitions to a more “modern” lifestyle, but until it does so, no lottery is going to stop people from reproducing (and if you had the ability to administer such a lottery fairly and reliably, you would be developed already).
    My point, hidden in there somewhere, was that concern about this issue seems to be an associated feature of membership in certain groups and consumption of certain kinds of information. It may be a concern worth having or it may not, but evidence and rationality is not driving it as much as (many) of its vessels seem to think…fashion and whatever else creates our vague ideological preferences may have more to do with it. Again, all this may not apply to you, but it may be an appropriate way to look at many other people (all of whom think of themselves as highly rational beings, prioritizing their concerns strictly on the basis of evidence and rational analysis).

  16. Yeah, look out for Japan’s robotic age, seriously. That will be the next big thing prior to the space age, and Japan has a very likelihood of leading the way. At the very least, they will be on par with China and the U.S. when robotics technology really gets mass commercial application. It will change life the way the Information Age picked up the U.S. economy and people’s way of life across the world.

  17. Brian Too

    Remember when Japan was feared as an industrial powerhouse? There were more than a few people who practically worshipped at the alter of kaizen, W. Edwards Deming, Japanese banks, high savings rates, the Japanese management/labour dynamic, salarymen, and all the rest.

    I don’t wish to pour cold water upon these things; some were (or are) undoubtedly great. They made Japan the industrial powerhouse. However Japan needs explaining in order to figure out if they presage our future. Also, if we wish to have a different future than theirs. That’s a whole topic in itself.

    Also let’s not forget renewal. Japan could be in a very different place 50 years from now than they are now. Once the current generational cohorts expire the demographic dice roll. The future is always up for grabs.


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About Razib Khan

I have degrees in biology and biochemistry, a passion for genetics, history, and philosophy, and shrimp is my favorite food. In relation to nationality I'm a American Northwesterner, in politics I'm a reactionary, and as for religion I have none (I'm an atheist). If you want to know more, see the links at http://www.razib.com


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