Impact of changes in the labor force and innovative agro-based food industry clusters on primary and food–beverage industries, and regional economies in Japan’s depopulating society

Suminori Tokunaga () and Mitsuru Okiyama ()
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Suminori Tokunaga: Reitaku University
Mitsuru Okiyama: Reitaku University

Asia-Pacific Journal of Regional Science, 2022, vol. 6, issue 1, No 16, 365-419

Abstract: Abstract Demographic changes such as a decline in the labor force population and increase in an elderly population in Japan since 2000 have not been uniform across regions. These population dynamics restrain regional Japanese industries and impede the growth of regional economies. The period from 2005 to 2030 can be divided into two periods according to the degree of depopulation: mild depopulation period (2005–2015) and rapid depopulation period (2015–2030). This demographic change has a significant impact on primary and food–beverage industries. The domestic supply of primary and food–beverage industries under mild depopulation declined from 2000 until 2015. Therefore, in this paper, we evaluate the impacts of the decline in labor force, domestic market, and total-factor productivity (TFP) on primary and food–beverage industries, and regional economies during these periods. As a countermeasure to the rapid decline in population and TFP for 2015–2030, policies for demand-side consumption tax reduction and supply-side innovative agro-based food industry clusters were proposed, and their economic effects empirically analyzed using the four-region computable general equilibrium (4SCGE) model. We found that the long-term sustainable economic development of primary and food–beverage industries, and regional economies under rapid depopulation requires a demand-side consumption tax reduction policy to stimulate short-term domestic demand as well as a supply-side innovative agro-based food industry cluster policy to expand long-term domestic production.

Keywords: Japanese food–beverage industry; Innovative agro-based food industry cluster; Depopulating society; Spatial CGE model; Kanto region and other regional areas; Vertical supply linkage (search for similar items in EconPapers)
JEL-codes: R11 R15 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1007/s41685-021-00210-x

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