1. Indicators of Social Quality in Japan with special reference to income inequality Akiko Sato Oishi Chiba University

2. Background  It is important to keep in mind three challenges that facing Japan, because they affect people ’ s values, institutions, and policies.

3. Background(2)  A rapid population ageing 65+/total pop. 20.2%(‘05) → 40.5%( ’ 55)  Increased fiscal+demographic pressures Reforms to make SS programs less generous: since mid 1990s  Growing inequality Gini coef. (HH size-adj. disp. inc.) 0.310( ’ 86) → 0.351( ’ 01)

4. Growing inequality (1) “ Jump ” in the late 1990s Trends in Gini coefficient (disposable income)

5. Growing inequality (2) Rising inequality among the young

6. Increased risk of poverty among children: 1987 and 2002

7.  Trends in income distriution have much to do with the trends in employment  The share of non-regular workers 16%( ’ 85) → 33%( ’ 06) in which: females 69%  Average hourly wages: 30-40%  Low coverage of SS 20% not covered by pub. pen. low entitlement to parental leave  Youth unemployment 4.3% ( ’ 90) → 10.1%( ’ 03) Japan ’ s dual labor market: Increased non-regular employment

8. Declined earnings of the young (1) Men: Aged 30-39 increased joblessness

9. Declined earnings of the young(2) Men: Aged 40-49 bi-polarized

10. Generational gap The elderly vs the young  Despite the growing inequality among the young, the SS system contributes very little to improve the economic well-being of the young.  More than 70% of SS expenditure in 2005 goes to the elderly (child- related benefits: 3.8%)  Per capita income & consumption of the elderly now exceed those of the young

13. Social cohesion: Beliefs on causes of poverty (1)  From the World Values Survey 1995 “ People are poor because of laziness or lack of will ” Agree: US 61% Australia 49% Korea 49% Finland, Spain, Sweden <25% Japan ….57%

14. Beliefs on causes of poverty (2)  From the World Values Survey 1995 “ People had a high chance of escaping poverty ” Agree: US and Norway 70-80% Germany, Spain <30% Japan ….80%

15. Beliefs on causes of poverty (3)  Ohtake and Tomioka (2003) “ Without income dispersion, people will not make full effort ” 71% “ One ’ s income is determined by the person ’ s past choices and efforts ” 57% → Little support for redistribution

16. Beliefs on causes of poverty ( ４ )  The Japanese believe poverty as the outcome of individual choice rather than the outcome of external events over which individuals have little control.  Similarity between the US

17. Who are excluded in Japan?  Male, Unmarried/Divorced, Jobless, 50s  Low incidence of material deprivation compared to other OECD countries d ’ Ercole (2006) Abe(2005) Japan: 10%, OECD average 13%  High incidence of isolation (lack of social networks), particularly among men NIPSS(2006) 20% of residents in Tokyo metropolitan area lack some kind of social networks

18. Social inclusiong/exclusion  Low incidence of material deprivation

19. Tentative conclusions  How to improve social quality in a society which puts much emphasis on self-help and effort?  Issues to be persued: social networks: men/women altruism The end

20. Overview of the presentation  Socio-economic security Data availability: very good Growing inequality Dual labor market The elderly vs the young(children)  Social inclusion/exclusion Limited availability of the data Lower material deprivation High incidence of lack of social networks

21. Overview of the presentation(cont.)  Social cohesion Limited availability of the data Beliefs on the causes of poverty: little support for redistribution  Empowerment Male/female gap