The JIP Database 1. What it is? 2. JIP 2009 results 3. A robustness check on JIP Labor Input Data

World KLEMS 1st ConferenceAugust 19-20, 2010

Kyoji Fukao (Hitotsubashi Univeristy)Tsutomu Miyagawa (Gakushuin University)Joji Tokui (Shinshu University)

1

1. What is the JIP Darabase?

• JIP = Japan Industrial Productivity• The JIP Database is compiled as one of the

RIETI’s research project. The RIETI (Research Institute of Economy, Trade and Industry) is a government agency.

• We are providing the JIP data on the RIETI’s website.

http://www.rieti.go.jp/en/database/index.html

2

JIP database 2009 table index #1/5

(1) Input-Output table1) Value of output and intermediate input table (current prices, million yen) [XLS:77KB] updated June 2, 20092) Value of output and intermediate input table (constant prices, million yen) [XLS:77KB] updated June 2, 20093) Input-output table (current prices, million yen) [ZIP:993KB] updated June 2, 20094) Input-output table (constant prices, million yen) [ZIP:1.36MB] updated June 2, 20095) Distribution of gross value added: current prices [XLS:305KB] updated June 2, 2009

i) Consumption of fixed capital ii) Indirect taxes and subsidies iii) Compensation of employees and mixed income iv) Operating surplus

6) Final demand by sectors (current prices, million yen) [XLS:298KB] updated June 2, 20097) Final demand by sectors (constant prices, million yen) [XLS:338KB] updated June 2, 2009

3

JIP database 2009 table index #2/5

(2) Capital input1) Investment by sectors [XLS:663KB] updated June 2, 2009

i) Investment by sector (constant prices, million yen) ii) Investment by asset (constant prices, million yen) iii) Indices of capital input by sector (2000=1.000) iv) Indices of capital quality by sector (2000=1.000) v) Average annual change in real net capital stock by sector (by percent) vi) Real net capital stock by sectors (year 2000 prices, million yen) vii) Real net capital stock by the type of capital goods (year 2000 prices, million yen) viii) Nominal capital services (nominal rental price*real net capital stock, million yen)

2) IT investment by sector [XLS:647KB] updated June 2, 2009 i) IT investment by sector (current prices, million yen) ii) IT investment by sector (constant prices, million yen) iii) IT investment (hardware) by sector (current prices, million yen) iv) IT investment (hardware) by sector (constant prices, million yen) v) IT investment (software) by sector (current prices, million yen) vi) IT investment (software) by sector (constant prices, million yen) vii) IT capital stock by sector (current prices, million yen) viii) Non-IT capital stock by sector (constant prices, million yen) 3) Investment matrix and stock matrix updated June 2, 2009

i) Investment matrix (current prices) [XLS:2.44MB] updated June 2, 2009 ii) Investment matrix (2000: constant prices) [XLS:2.43MB] updated June 2, 2009 iii) Stock matrix (2000: constant prices) [XLS:2.56MB]

4

JIP database 2009 table index #3/5

(3) Labor input1) Indices of labor input by sector (2000=1.000) [XLS:86KB] updated June 2, 20092) Average annual change in indices of labor input by sector (%) [XLS:41KB] updated June 2, 20093) Indices of man-hours by sector (2000=1.000) [XLS:85KB] updated June 2, 20094) Average annual change in man-hours (%) [XLS:41KB] updated June 2, 20095) Indices of labor quality by sector (2000=1.000) [XLS:101KB] updated June 2, 20096) Average annual change in indices of labor quality by sector (%) [XLS:41KB] updated June 2, 20097) Number of workers by sector [XLS:93KB] updated June 2, 20098) Man-hours by sector (1,000 workers* total annual working hours) [XLS:85KB] updated June 2, 20099) Nominal labor costs by sector (million yen) [XLS:85KB] updated June 2, 200910) Female ratio (female workers/total workers, %) [XLS:32KB] updated June 2, 200911) Part-time workers ratio (part-time workers/total workers, %) [XLS:32KB] updated June 2, 200912) Ratio of workers over 55 years old (workers over 55 years old/total workers, %) [XLS:32KB]

5

JIP database 2009 table index #4/5

(4) Growth accounting [ZIP:1.62MB] updated June 17, 2009 1) Individual spreadsheet titles 2) Definition of aggregate sectors 3) Output (year 2000 prices, million yen) 4) Growth rate of output (constant prices) 5) Output (current prices, million yen) 6) Intermediate input index (Divisia index, 2000=1.000) 7) Intermediate input (Simple total, year 2000 prices, million yen) 8) Intermediate input (current prices, million yen) 9) Value added (current prices, million yen) 10) Labor input index (Divisia index, 2000=1.000) 11) Labor costs by sector (current prices, million yen) 12) Indices of labor quality (2000=1.000) 13) Indices of man-hours (2000=1.000) 14) Indices of capital service input (Divisia index, 2000=1.000) 15) Capital services (current rental price*constant net capital stock, million yen) 16) Indices of capital quality (2000=1.000) 17) Indices of net capital stock (2000=1.000) 18) Cost share of production factor 19) Growth rate of sectoral TFP 20) Contribution by production factors (value added base) 21) Contribution by production factors (output base) 22) Growth accounting (value added base) 23) Growth accounting (output base) 24) TFP percentage change (value added base)

6

JIP database 2009 table index #5/5

(5) Supplementary tables updated June 2, 2009 1) Regulation Indices for 97 Sectors [CSV:45KB] updated June 2, 2009

2) Outward FDI by JIP 2009 Sector and Region: 1985-2005 [CSV:352KB]For figures in more detailed country classification, see RIETI FDI database. updated June 2, 20093) Share of Workers by Occupation and JIP 2009 Sector: 1980-2005 [CSV:444KB]

(6) Industry concordance with JSIC and ISIC updated June 28, 2008

CSV [CSV:121KB] PDF [PDF:218KB]

7

We are working on the team.

JIP 2009 was compiled by the following scholars.

Annual input-output tables FUKAO Kyoji (Hitotsubashi University) MATSUURA Toshiyuki (Keio University) OKANO Yusuke (Graduate School, Senshu University) KWON Hyeog Ug (Nihon University) Capital service input data MIYAGAWA Tsutomu (Gakushuin University) INUI Tomohiko (Economic and Social Research Institute, Cabinet Office and Nihon University) HISA Shoichi (RIETI Research Assistant) Labor input data TOKUI Joji (Shinshu University) MAKINO Tatsuji (RIETI Research Assistant) Supplementary tables ITO Keiko (Senshu University) INUI Tomohiko (Economic and Social Research Institute, Cabinet Office and Nihon University) MATSUURA Toshiyuki (Keio University)

8

JIP sector classification

9

JIP No. Sector Name JIP No. Sector Name JIP No. Sector Name

1 Rice, wheat production 37 Miscellaneous iron and steel 73 Railway

2 Miscellaneous crop farming 38 Smelting and refining of non-ferrous metals 74 Road transportation

3 Livestock and sericulture farming 39 Non-ferrous metal products 75 Water transportation

4 Agricultural services 40 Fabricated constructional and architectural metal products 76 Air transportation

5 Forestry 41 Miscellaneous fabricated metal products 77 Other transportation and packing

6 Fisheries 42 General industry machinery 78 Telegraph and telephone

7 Mining 43 Special industry machinery 79 Mail

8 Livestock products 44 Miscellaneous machinery 80 Education (private and non-profit)

9 Seafood products 45 Office and service industry machines 81 Research (private)

10 Flour and grain mill products 46 Electrical generating, transmission, distribution and industrial apparatus 82 Medical (private)

11 Miscellaneous foods and related products 47 Household electric appliances 83 Hygiene (private and non-profit)

12 Prepared animal foods and organic fertilizers 48 Electronic data processing machines, digital and analog computer equipment and accessories 84 Other public services

13 Beverages 49 Communication equipment 85 Advertising

14 Tobacco 50 Electronic equipment and electric measuring instruments 86 Rental of office equipment and goods

15 Textile products 51 Semiconductor devices and integrated circuits 87 Automobile maintenance services

16 Lumber and wood products 52 Electronic parts 88 Other services for businesses

17 Furniture and fixtures 53 Miscellaneous electrical machinery equipment 89 Entertainment

18 Pulp, paper, and coated and glazed paper 54 Motor vehicles 90 Broadcasting

19 Paper products 55 Motor vehicle parts and accessories 91 Information services and internet-based services

20 Printing, plate making for printing and bookbinding 56 Other transportation equipment 92 Publishing

21 Leather and leather products 57 Precision machinery & equipment 93 Video picture, sound information, character information production and distribution

22 Rubber products 58 Plastic products 94 Eating and drinking places

23 Chemical fertilizers 59 Miscellaneous manufacturing industries 95 Accommodation

24 Basic inorganic chemicals 60 Construction 96 Laundry, beauty and bath services

25 Basic organic chemicals 61 Civil engineering 97 Other services for individuals

26 Organic chemicals 62 Electricity 98 Education (public)

27 Chemical fibers 63 Gas, heat supply 99 Research (public)

28 Miscellaneous chemical products 64 Waterworks 100 Medical (public)

29 Pharmaceutical products 65 Water supply for industrial use 101 Hygiene (public)

30 Petroleum products 66 Waste disposal 102 Social insurance and social welfare (public)

31 Coal products 67 Wholesale 103 Public administration

32 Glass and its products 68 Retail 104 Medical (non-profit)

33 Cement and its products 69 Finance 105 Social insurance and social welfare (non-profit)

34 Pottery 70 Insurance 106 Research (non-profit)

35 Miscellaneous ceramic, stone and clay products 71 Real estate 107 Other (non-profit)

36 Pig iron and crude steel 72 Housing 108 Activities not elsewhere classified

Sectors, and years the JIP covers.

• The JIP covers 108 sectors, of which 52 sectors are manufacturing, and of which 46 sectors are services.• These sectoral classification are on the activity

(commodity) basis, not on the industry basis.• The JIP 2009 covers years from 1970 to 2006.

Now we are preparing the JIP 2010, scheduled to be provided on September.

10

How we construct the JIP data? – (1) Input-Output (IO) Tables

• The symmetric IO Tables of the JIP are based on three types of IO tables compiled by the Japanese government:

1) Linked IO Tables (every 5 years), 2) Annual Extended IO Tables (annually), 3) SNA IO Tables (annually).• Using RAS method we estimate the JIP-108-sector IO

tables annually.

11

How we construct the JIP data? – (2) Capital

• We construct net capital stock and capital service indices.

• 39 types of assets×108 sectors• We construct investment series by industry and by asset.

We use capital formation data from the Fixed Capital Flow Matrix, which is published every five years. We interpolate the data for intervening years by using industry-specific surveys.

• To construct net capital stock series we use the perpetual inventory method based on BEA depreciation rates for various types of assets.

12

How we construct the JIP data? – (3) Labor

• The JIP labor data is cross-classified by gender, age (11 categories), education (4 categories), and employment status of workers (3 categories).

• For employment status of workers, we have the category of part-time workers.

• Since sectral classification of labor data is based on industry, we convert labor data into activity base using V-table of SNA to be consistent with the IO tables and capital series.

13

14

Table 3.1: Labor input characteristics1. Gender 1 Male

2 Female2. Employment status 1 Self-employed and unpaid family workers

2 Full-time wage and salary workers3 Part-time wage and salary workers

3. Education 1 Junior high school(only for full-time wage and salary worker) 2 Senior high school

3 Higher professional school and junior college4 University

4. Age 1 15-19 years old2 20-24 years old3 25-29 years old4 30-34 years old5 35-39 years old6 40-44 years old7 45-49 years old8 50-54 years old9 55-59 years old

10 60-64 years old11 65 years old and over

5. Industry 108 JIP industry classification

2. JIP 2009 results

15

In the order of 1980s’ TFP growth rate

16

In the order of 1980s’ TFP growth rate

17

18

• In the 1980s there were sharp contrast between productivity-rising sectors and productivity-declining sectors.

• In the 1990s productivity change was slowed in the overall sectors.

• In the first half of 2000s it seems to be the emergence of some productivity-rising sectors. But these productivity-leading sectors in the 2000s are not the same as those in the 1980s.

Growth Accounting-(1) Macroeconomy

Table1. Macroeconomy

　 1970-80 1980-901990 －

20002000-2005 2005-2006 2000-2006

Real GDP Growth 4.15% 4.58% 1.23% 1.89% 1.54% 1.83%

Contribution of Labor Input Growth

1.11% 0.92% -0.10% -0.20% 1.70% 0.12%

Contribution of Man-hours Growth

0.28% 0.38% -0.55% -0.69% 0.69% -0.46%

Contribution of Labor Quality Growth

0.82% 0.54% 0.45% 0.48% 1.01% 0.57%

Contribution of Capital Input Growth

1.69% 2.01% 1.17% 0.74% 0.69% 0.73%

Contribution of Capital Quantity Growth

2.14% 1.59% 1.08% 0.49% 0.38% 0.47%

Contribution of Capital Quality Growth

-0.46% 0.43% 0.10% 0.25% 0.31% 0.26%

TFP Growth 1.36% 1.64% 0.16% 1.35% -0.85% 0.99%

Output and material input growth rates are calculated using a cost based Divisia quantity index.

19

Growth Accounting-(2) Manufacturing

Table 2. Manufacturing sectors

　 1970-80 1980-901990 －

20002000-2005 2005-2006 2000-2006

Real GDP Growth 4.72% 6.30% 0.95% 2.71% 5.38% 3.16%

Contribution of Labor Input Growth

0.13% 0.90% -1.31% -1.41% 3.01% -0.67%

Contribution of Man-hours Growth

-0.47% 0.42% -1.84% -1.73% 1.56% -1.18%

Contribution of Labor Quality Growth

0.60% 0.48% 0.53% 0.32% 1.45% 0.51%

Contribution of Capital Input Growth

0.77% 1.69% 0.92% 1.40% 1.94% 1.49%

Contribution of Capital Quantity Growth

1.06% 1.24% 0.78% 0.98% 1.65% 1.09%

Contribution of Capital Quality Growth

-0.29% 0.45% 0.14% 0.42% 0.29% 0.40%

TFP Growth 3.82% 3.71% 1.34% 2.72% 0.43% 2.34%

Output and material input growth rates are calculated using a cost based Divisia quantity index.

20

Growth Accounting-(3) Non-manufacturing

Table 3. Non-manufacturing sectors (Only market economy, Excluding Housing and Activities not elsewhere classified)

　 1970-80 1980-901990 －

20002000-2005 2005-2006 2000-2006

Real GDP Growth 3.44% 4.34% 1.03% 1.52% 0.05% 1.27%

Contribution of Labor Input Growth

1.36% 1.01% 0.12% -0.52% 1.85% -0.13%

Contribution of Man-hours Growth

0.37% 0.34% -0.34% -0.88% 0.37% -0.67%

Contribution of Labor Quality Growth

1.00% 0.67% 0.46% 0.35% 1.48% 0.54%

Contribution of Capital Input Growth

1.67% 2.03% 1.11% 0.51% 0.45% 0.50%

Contribution of Capital Quantity Growth

1.81% 1.62% 0.96% 0.33% 0.16% 0.30%

Contribution of Capital Quality Growth

-0.14% 0.40% 0.16% 0.19% 0.28% 0.21%

TFP Growth 0.41% 1.31% -0.20% 1.53% -2.25% 0.90%

Output and material input growth rates are calculated using a cost based Divisia quantity index.

21

• The Japanese economic growth somewhat recovered in the first half of 2000s after experiencing slow growth in the 1990s.

• This recovery was mainly caused by the TFP growth.• In 2006 the TFP growth began to stagnate, which

effect was partly offset by the increase in labor input.• We can find these tendencies in both manufacturing

and non-manufacturing sector.

22

3. A robustness check on JIP Labor Input Data

• As a robustness check on JIP labor data, we estimated the productivity disparities between self-employed workers and employees by estimating a production function.

• The data we used are enterprise-level micro data from the Census of Manufacturing between 1981 and 2000.

Tokui, Joji, Tatsuji Makino, and Yoko Takahashi, “Productivity Disparities between Self-Employed Workers and Employees,” RIETI Discussion Paper 09-J-018 (in Japanese).

23

First-difference OLS estimation of production function

sample size2736845

R**20.294

　 coefficient standard error p-valuerelative

productivity(*)

capital service 0.069 0.000 0.000

capital service × self-employed dummy

-0.011 0.002 0.000

intermediate input 0.325 0.001 0.000

female employee in corporation

-0.148 0.003 0.000 0.760

male employee in non-corporation

-0.062 0.005 0.000 0.900

female emplyee in non-corporation

-0.221 0.005 0.000 0.642

male self-employed 0.242 0.019 0.000 1.392

female self-employed -0.014 0.022 0.534 0.978

constant term 0.016 0.000 0.000 　

(*)It means relative productivity of each category's worker to male employee in corporation.

24

Figure 1. JIP labor input after adjusting self-employed workers’ productivity

25