Japanese Social Expenditure under Rapid Population Ageing

Abstract

Japan is suffering from low fertility for more than two decades, and Japanese social security system needs a structural reform to be more effective and sustainable. In this paper, we discussed structural issues in the Japanese social security system, which will provide the basis for containing social expenditure in Japan. Some Japanese benefits, such as child-rearing support and benefit for low income families as well as long-term care benefit, need to be increased. On the other hand, it is important to incorporate right incentives in the system for healthcare and LTC services, and new forms of solidarity are indispensable to make Japanese social security system sustainable.