June 2019

10Jun

Japan. In historic first, G20 weighs aging as global risk

Ballooning healthcare costs, labor shortages and financial services for the elderly: for the first time Sunday, the world's top policymakers are tackling economic issues relating to aging and shrinking birthrates. G20 finance ministers and central bank chiefs meeting in Japan -- where a rapidly aging population is a major domestic problem -- have been warned to address the issue before it is too late. "What we are saying is, 'If the issue of aging starts to show its impact...

June 10, 2019
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04Jun

Japan’s pensions inadequate for aging society: gov’t council report

Japan's current public pension system is not adequate to support people's livelihoods anymore facing the rapid aging problem, a Japanese government report revealed Monday. According to the estimation by a council at Japan's Financial Services Agency, a couple who will live until 95 years old will need at least 20 million yen (184,700 U.S. dollars) after retirement, which exceeds the amount their pension benefits can cover. The report also said that in an example of a couple with the...

June 4, 2019
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May 2019

23May

Japan’s Financial Services Agency calls for financial products that focus on longevity risk

The Financial Services Agency has released a draft report calling for financial products that focus on longevity risk, or when people’s funds for living expenses run short due to a rise in longevity. The draft includes plans for the agency to urge financial institutions to expand their ranges of financial products and services that respond to an aging society. It also noted the need for services that preserve assets for when people’s cognitive functions deteriorate. The document was presented...

May 23, 2019
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April 2019

22Apr

An Economic Analysis of Intra-governmental Account Transfers: Social Security and Public Infrastructure in Japan

By Yoshimi Adachi (Konan University - Department of Economics) & Tomoki Kitamura (Tohoku Gakuin University; NLI Research Institute, Finance Research Group) In the context of limited local government resources, it is often targeted to secure financial resources for social security expenditures for the aging society and upkeep expenditures against the aging of public infrastructure facilities. This paper examines whether transfers from general accounts to special accounts and public enterprise accounts have a significant impact on the financial burden of local...

April 22, 2019
Aging, Articles, Pension design, ,
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15Apr

OECD warns Japan of risks from ageing population

The Organisation for Economic Co-operation and Development (OECD) on Monday warned of the risks Japan faces due to its ageing population. In 2017, there were 50 Japanese people aged 65 per hundred, while the rest were aged between 20 to 64, and this ratio is projected to rise to 79 per hundred in 2050, according to a report presented by OECD Secretary General Angel Gurria here. "Half of the children born in Japan in 2017 are expected to live...

April 15, 2019
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15Apr

How the World’s Largest Pension Manager Is Trying to Make ESG Investing More Popular

The financial industry has jumped on the impact investing and environmental, social or governance—or ESG—bandwagon. But Hiromichi Mizuno, the man who oversees $1.6 trillion in the world’s largest public pension fund, says true believers on Wall Street are still hard to find, so he is taking his own steps to push ESG and impact investing off the sidelines. As chief investment officer of Japan’s Government Pension Investment Fund, Mizuno requires his asset managers to integrate ESG into their investment...

April 15, 2019
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11Apr

Pension burden: More Japanese opt to retire late, extend employment period

Some economists expect the average pension-to-wage ratio to keep deteriorating and worries are growing that Japan's 'pay-as-you-go' pension scheme may be unsustainable Yasuhiro Furuse could have retired two years ago, but he wasn’t entirely happy with his pension income and had to put any such thoughts to bed.It was just as well for Furuse’s employer Orix Corp, a financial services group, which would have struggled to find a replacement, with Japan’s jobless rate at 26-year lows. This win-win arrangement, increasingly common...

April 11, 2019
Aging, Articles, Labor Market,
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March 2019

20Mar

What Japan Can Teach Us About The Opportunities Of An Ageing Society

Prime Minister Abe’s recent visit to the UK was a chance for the two countries to talk about common issues affecting their future. Let’s hope one of the topics they discussed was how to deal with an ageing society. In the 1970s and 1980s the world looked to Japan to learn about lean manufacturing. After the 2007-8 global financial crisis it looked to Japan to see how to deal with the aftermath of a financial crisis. Japan is a...

March 20, 2019
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17Mar

The Feasibility of Reverse Mortgages in Japan

By Richard K. Green (University of Southern California - Lusk Center for Real Estate) & Linna Zhu (USC Sol Price School of Public Policy) This paper examines the feasibility of reverse mortgages in Japan by utilizing stochastic modeling to characterize the movements of three stochastic variables—interest rates, property values and mortality—underpinning the value of reverse mortgages. We use the yield curve to forecast future interest rates, taking into account the interest arbitrage condition and the term premium. We employ hedonic...

March 17, 2019
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17Mar

Population Aging, Health Care, and Fiscal Policy Reform: The Challenges for Japan

By Minchung Hsu (National Graduate Institute for Policy Studies (GRIPS)) & Tomoaki Yamada (Meiji University - School of Commerce) We construct a transition analysis based on a general equilibrium life‐cycle model to investigate the effects of aging, and we evaluate various policy alternatives designed to lessen the negative influence of aging. In particular, we analyze reforms of insurance benefits and tax financing tools that were recently the focus of a great amount of attention and debate in Japan because of...

March 17, 2019
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