Are Japanese Households Financially Healthy, If So, Why?

Horioka, Charles Yuji

doi:10.2753/jes1097-203x390405

Cited by 5 publications

(3 citation statements)

References 8 publications

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“…Similarly, Kohara and Horioka (2006) find that 8 to 15% of young Japanese couples are borrowing (liquidity) constrained. Moreover, Horioka (2012aHorioka ( , 2012b and Horioka and Niimi (2020) find that the ratio of household liabilities to household disposable income in Japan was the highest among the Group of Seven (G7) countries until at least 2005.…”

Section: Evidence On the Importance Of Borrowing (Liquidity) Constraintsmentioning

confidence: 99%

Is the selfish life-cycle model more applicable in Japan and, if so, why? A literature survey

Horioka

2020

Rev Econ Household

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The selfish life-cycle model or hypothesis is, together with the dynasty or altruism model, the most widely used theoretical model of household behavior in economics, but does this model apply in the case of a country like Japan, which is said to have closer family ties than other countries? In this paper, we first provide a brief exposition of the simplest version of the selfish life-cycle model and then survey the literature on household saving and bequest behavior in Japan in order to answer this question. The paper finds that almost all of the available evidence suggests that the selfish life-cycle model applies to at least some extent in all countries but that there is more consistent support for this model in Japan than in the United States and other countries. It then explores possible explanations for why the life-cycle model is more consistently supported in Japan than in other countries, attributing this finding to government policies, institutional factors, economic factors, demographic factors, and cultural factors. Finally, it shows that the findings of the paper have many important implications for economic modeling and for government tax and expenditure policies.

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Section: Evidence On the Importance Of Borrowing (Liquidity) Constraintsmentioning

confidence: 99%

Is the selfish life-cycle model more applicable in Japan and, if so, why? A literature survey

Horioka

2020

Rev Econ Household

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“…Table 2 shows flow data on the ratio of new housing loans to housing purchases (commonly referred to as the loan-to-value ratio), which indicates the proportion of ４ See Horioka (2012) for earlier data on this ratio. housing purchases financed by housing loans, or to put it another way, one minus the down payment ratio.…”

Section: The Benefits Of the Increasing Availability Of Housing Credit In Japanmentioning

confidence: 99%

Was the Expansion of Housing Credit in Japan Good or Bad?

Horioka

Niimi

2020

SSRN Journal

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This paper shows, using data from the Family Income and Expenditure Survey, that housing credit has become increasingly available over time in Japan, especially since 2000, and that this has made it easier for Japanese households to purchase housing and enabled them to do so at an earlier age. However, it also shows that the greater availability of housing credit has increased households' housing loan repayment burden, which has resulted in their cutting back on their other consumption expenditures and created the potential for retirement insecurity. Another concern is that the increasing availability of housing credit has been accompanied by a pronounced shift from fixed-rate to variablerate housing loans. This is cause for concern given the low level of financial literacy that prevails among the Japanese population and the likelihood that interest rates on variablerate housing loans will be raised sooner or later as monetary policy is tightened.

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Section: Evidence On the Importance Of Borrowing (Liquidity) Constraintsmentioning

confidence: 99%

Are Japanese Households Financially Healthy, If So, Why?

Cited by 5 publications

References 8 publications

Is the selfish life-cycle model more applicable in Japan and, if so, why? A literature survey

Is the selfish life-cycle model more applicable in Japan and, if so, why? A literature survey

Was the Expansion of Housing Credit in Japan Good or Bad?

Is the Selfish Life-Cycle Model More Applicable in Japan and, If so, Why? A Literature Survey

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