Aging is one of the most important issues in developed countries, and this book discusses it from various points of view. The issue is particularly serious in Japan; the monograph notes that Japan's ‘old age dependency ratio’ (population over 65/population between 15 and 64) will be 83.1% in 2040 — the highest among OECD countries. Japanese scholars, policymakers, and politicians have long been discussing this problem, but this book offers empirical analyses from an international perspective, making comparisons of the situation faced by many countries, including Japan.
This book comprises 11 chapters written by 12 authors from various backgrounds, such as sociology and political science.
In the first chapter, the editors of this book survey research developments in this field. They summarize the situation in which there has been relatively little unified progress, despite the longstanding call for political-science-based studies. There has been much research in recent years on the consequences of population aging, and readers are presented with an easy-to-understand study map of this field.
The second chapter discusses the rise of pensioners’ parties in Europe and Israel over the last two decades. The conditions for success of such parties are not simple. The chapter explains the complicated conditions for success, noting that the development of pensioners’ parties needs to be understood in terms of the failure of established parties to adapt to socioeconomic change and growing electoral demand for anti-establishment protest parties, rather than simply as growth in ‘grey interest’ politics, where the rise in the number of the aged leads to an increase in the political power of the aged.
The third chapter compares Germany, Italy, and Japan. The author compares the rhetoric and actions of the political parties in these countries, and points out that the three countries have reduced pension benefits and increased the age from which benefits are provided. These developments cannot be explained simply in terms of ‘grey interest’ politics. The author explains that the government cannot but retrench pensions when the aged population grows. This is similar to the argument regarding farmers’ political power. In developing countries, the political power of farmers is weak because the government cannot provide large budgetary allocations to the farm sector, while, in developed countries, the government can afford to spend more because the number of farmers is small.
It is interesting that the author also points out that Japan has been able to cut pensions because the Liberal Democratic Party dominated Japanese politics for decades and was free to take tough measures due to the lack of viable electoral competition. The situation, however, has changed, and social security expenditures for the aged have sharply increased since the last days of the LDP era through the administrations of the Democratic Party of Japan until the end of the last year, forcing the recent hike in the consumption tax.
It seems natural that we should work longer if we are living longer. Otherwise, the social security system for the aged cannot be maintained. The fourth chapter shows that two very different countries — Germany and the UK — have made similar changes to their pension systems. This finding suggests that demographic aging, specifically the growth in life expectancy, is a common experience that leads to similar policy challenges in countries with diverse institutional and policy legacies. Germany and the UK had several political reform conditions in common. This suggests that the generational politics of pension reform are remarkably similar across very different political systems. Political scientists, including the author of the chapter, seem to be surprised by this similarity, but as an economist I would simply note the importance of following the numbers of the aged.
The fifth chapter stresses the subtly differing results to similar challenges, while the preceding chapters emphasized the similarity of results to similar changes. The author concludes that different welfare states have developed varying pension policies based on their welfare regimes, while the demographic and economic challenges are similar across OECD countries. There are significant differences among welfare regimes with regard to gender and generational inequalities of pension systems.
The author identifies four categories of regimes, namely the Social Democratic, the Southern European, the Continental European, and the Liberal welfare regimes. He points out that the Social Democratic regime has a better labor market and pension structure that mitigates gender and generational inequalities, and that the Southern European welfare regime has more generous pensions and higher public old-age spending and pension levels, but also higher old-age poverty rates and pension inequalities.
The author concludes that, in sum, different welfare regimes are characterized by varying degrees of gender and generational inequalities and that these inequalities are less serious in Social Democratic welfare regimes, where higher social spending is directed toward women and the young.
Of course, there are some differences in these regimes, but all have generous pension systems. Additionally, although I would earlier have placed Japan in the Liberal category, I realized, after reading the chapter, that the country would more appropriately be labeled a Southern European regime.
In the sixth chapter, the authors explain that policymakers prefer to resort more frequently to implementing less radical pension cutbacks in order to intermittently gain temporary macro-fiscal breathing space, rather than a more radical corrective retrenchment of the pension program.
The seventh chapter shows that while the countries where the elderly have greater political leverage were significantly more likely to provide higher standard pension replacement rates, elderly political power was negatively associated with the generosity of the minimum pension. This might seem surprising, but not if we think that the median aged voter is quite powerful; it also explains that pensions do not lessen the inequality.
The eighth chapter covers family policy. The authors argue that the state is not active in providing for families and children, that the social situation of other generations does not have much bearing, and that the expected level of public childcare is low. Japan is no exception.
In the ninth chapter, the authors compare the US and the UK. They point out that in the US many formerly well-protected groups now find themselves more exposed to risk; some of them look to public policies to fill the gap. Conversely, the dramatic decline of support for unemployment policies in the UK is particularly marked among workers, the former bastions of support for state intervention. The situation in Japan will become similar to that in the US.
The tenth chapter shows that working women are more likely to live with partners in countries with generous dual-earner policies.
The last chapter summarizes the preceding chapters and gives the author's own interesting comments and observations.
Most of cases dealt with in the book are European, but there are many similarities to cases in Japan. This book compiled by younger scholars is extremely valuable when thinking of reforms in post-industrial democracies, including Japan.
