Homework #4

Ryoichi Imai

2004/10/25

Due: Wednesday, January 19, 2005

Answer to all the questions. Type your answers on A4 papers.  At the top of your homework, type your name and e-mail address.

Submit your work to me or leave it in my mailbox, located at the ground level of the International Student Center.  Return the textbook to my office.

The numbers in ( ) represent the corresponding pages. Write your answers in your own words. Never copy a large part of the paragraph, even if you do not know the answer. 

Answer to the following questions, based on Chapter 6, "The Aging of Society and Fiscal Policy" of Japan's Lost Decade by Hiroshi Yoshikawa. 

  1. "While children may be able to renounce the debts left behind by their parents, future generations will not be able to escape the burden of debt from the nation's fiscal deficit." Why is this claim wrong? (165)

  2. It is said that the fiscal debts harm future generations' welfare if the economy is in full employment. What does this mean? Why is this claim inappropriate for the present Japanese economy? (166)

  3. It is said that the fiscal debts harm future generations' welfare if the budget deficit is used to finance consumption or useless public investment. What does this mean? Why is this claim inappropriate for the present Japanese economy? (168)

  4. Why does a rise in the public burden ratio have a negative impact on economic growth? State the second reason. (172)

  5. What did Atkinson find? (172)

  6. What is the first objective of public medical insurance systems? (175)

  7. What is the major change that occurred between 1961 to 1970 in the medical treatment ratio? Why is this so important? (176)

  8. Why Japan's life expectancy stagnated during the pre-war period? (178)

  9. What are the major factors to reduce the Japan's infant mortality rate? (179)

  10. What is the more important point of view than the intergenerational equity in the debate of the public pension system? (180)

  11. What is the "9 - 6 - 4" problem in the Japan's taxation system? (181)

  12. What are the three systems composing the Japan's public pension? (182)

  13. What is the grave problem of the National Pension, which is similar to the uneven taxation problem? (184)

  14. What is the author's idea on the public pension reform? (185)

  15. What are the examples of specific measures to implement the structural reform of the nation's entire fiscal policy? (186)