1. 4th NTA Workshop Berkeley, January 2007 Population Aging and NTA in Japan Naohiro Ogawa, Maliki, Rikiya Matsukura and Kazuro Nemoto

2. Trend in Total Fertility Rate, Japan: 1947-2005

3. Trend in the synthetic proportion still single at age 50 Male Female Note: The synthetic proportion still single at age 50 is calculated from age-specific first-marriage rates in the specified calendar year.

4. Trend in life expectancy at birth in OECD countries, both sexes combined, 1960-2001

5. Proportion 65 and over:1884-2006

6. UN Government Forecast numbers of female centenarians

7. The Japanese population has just become the oldest in the world and has started to decline!

8. 200020052010201520202025 Year 1.19 1.2 1.21 1.22 1.23 1.24 1.25 1.26 1.27 1.28 Billion Projected total population, 2000-2025

9. And massive age structural shifts!

10. Age structural change: 1950-2025 65+/15-64 0-14/15-64

11. Pension benefits / National income Medical expenditure / National income Social security benefits / National income

12. Japan is a pitiful state of public finance Household as like….. Monthly income (revenue from tax and others) $4,000 Consumption (government expenditure) $3,700 Remittance (grants to local government) $1,200 Paying loan (government bond) $1,500 Debt (government debt) $520,000 Deficit per month $4000-$3700-$1200-$1500=-$2400

13. Here comes The most important graph in Japan!

21. Working life expectancy at age 15 (Unit: years)

32. Crossing ages CountryCrossing ages for consumption and labor income Y(x) > C(x) Younger AgeOlder Age Japan (1984)2359 Japan (1989)2559 Japan (1994)2659 Japan (1999)2759 Japan (2004)2859 US (2000)2656 Taiwan (1998)2456 Indonesia (1996)2858 Thailand (1996)2659 Costa Rica (2004) 2456

45. Labor Income Public Transfers Asset Reallocation Intervivos Transfers

46. Labor Income Public Transfers Asset Reallocation Intervivos Transfers

48. Japan NTA team’s next steps

49. Policy Implication using NTA results

50. Pronatalist favorite assertion :  Only 3.6% of social security benefits is children-specific; while  70.4% of social security benefits is for the elderly (60+)

51. Ratio of Transfers Received by Elderly/Children Based upon NTA 1989199419992004 Public transfers on health, education, and pension Aggregates0.961.552.072.92 Per capita1.621.952.012.27 Total transfers, both intervivos and public on health, education, and pension Aggregates0.71.161.552.23 Per capita1.181.461.511.73

52. Estimation on time transfer (volunteering time) Data: Survey on time use and leisure activities Available Variables: Age, Education, Marital status, Activity of caring, Place where own child lives, Normal economic activity, Employment Status, Size of firm, Occupation, Normal working hours per week, Normal commuting time (one-way), etc.

53. Thank you