Toshihiro Okubo: After the bubble break of 1991, the Japanese economy has seen a long-run recession, known as the Lost Decades. During the recession, market competition remains stagnant. One of the most important issues in this literature is firm/industrial productivity and the Japanese market structure. Many previous studies have investigated the evolution of TFP at the industrial level in the last decades, and this paper follows this line of study. The main focus of this paper is the relationship between market competition and sectoral productivity, using the Japanese sectoral data set, JIP Data (RIETI).
Market competition is a current policy issue in Japan. The Japanese government has reformed market structure by deregulations, particularly in service sectors. Junichiro Koizumi, the former Japanese prime minister from 2001–06, proposed structural reform. Post offices, for example, were privatized. More recently, Prime Minister Abe has sought the structural reform, so-called Abenomics, which centers on monetary...