TITLE:
Migration, Employment, and Industrial Development in Japan
AUTHORS:
Tetsuya Nakajima
KEYWORDS:
Industrial Development, Migration, Employment
JOURNAL NAME:
Theoretical Economics Letters,
Vol.4 No.8,
October
14,
2014
ABSTRACT: Industrial
development in Japan is accompanied by massive migration from agricultural to
industrial areas. In a modified Harrod-Domar model, this paper compares two
steady states, the first and the second, which emerge before and after the
termination of such migration, respectively. Then, the paper shows that
employment rates must be lower in the second steady state. Further, by
examining the effects of fiscal policy, the paper shows that the balanced
budget multiplier exceeds unity, and fiscal policy raises households’ disposable
income and consumption.