The Cabinet Office regularly publishes its Economic and Fiscal Projections for Medium to Long-Term Analysis outline. The latest projection, released in July, said Japan's GDP growth "is projected to rise gradually and reach 2 percent in real terms and 3 percent or more in nominal terms in the latter half of the 2020s." Can we accept such a projection?

A nation's demographic trend affects its economic growth over the long term. Also, from the experience of Japan's economy, it is widely known that productivity growth is a key factor for its economic performance on the long run. Whether the government's optimistic growth projection comes true or not will depend heavily on future productivity growth. It is necessary to discuss what the relationship is between demographic changes and productivity.

Studies of past economic growth provide many hypotheses about population and economic growth. As for productivity growth, there are some interesting hypotheses.