James Dennin, Kapitall: Womenomics - making money and making babies - is the cure for the struggling Japanese economy. Wait. What?
Japanese Prime Minister Shinzo Abe – the source of 'Abenomics' – rang the closing bell of the New York Stock Exchange yesterday. It was all part of a charm offensive to calm Western concerns about investing in a nation where a shrinking population, dwindling capital expenditure, and one of the greatest environmental catastrophes in human memory have stalled growth.
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Abe came to power with a pledge to turn Japan around, and return it to its glory days when the country emerged from post-war rubble to become a manufacturing powerhouse in a matter of decades.Manufacturing has been stalled in Japan, in part because Japanese workers now seem to make too much. Abenomics, or the set of economic policies that the Prime Minister has championed as part of his platform, has three prongs: monetary easing, fiscal stimulus, and structural reforms aimed at growth. In a prominent Wall Street Journal editorial yesterday, Abe revealed a fourth component of his plan: "Womenomics." His goal is to have more women in boardrooms by the Olympics in 2020 – saying that this will not only boost Japan's GDP – but also reverse the trend of declining fertility. Abe's plans are laudable in many respects, but he faces some pretty big obstacles:
- Japan is seen as an extremely conservative country.
- Corporate executives are slow to invest.
- Cultural norms can be hard to change.