"Macro Dynamics and Labor-Saving Innovation: US vs. Japan"

This article deals with the empirical analyses of the growth for the United States and Japan from 1970 to 2005. Following our analysis in "Quantity or Quality: The Impact of Labor-saving Innovation on US and Japanese Growth Rates, 1960-2004" (March 2007), we applied the same method to a different data series in order to confirm our previous findings. As with the previous paper, the results shown in this paper support our view that Japan's declining population can be compensated for by additional quality improvement of the existing labor force.