3) Examination of the standards of living in both countries through economic and social welfare
From the examination of the GDP contribution in the different sectors of Japan and Poland, it can be understood that Japan is far ahead of Poland in terms of GDP and PPP (Purchasing Power Parity). The former ranks 3rd in terms of nominal GDP while the latter ranks 21st in the same segment. It can be realized that the economic and social welfare of Japan is way better than Poland in the current scenario.
GDP per capita
According to the current statistical figures, the GDP per capita of Japan is $40,847 nominal and $45,546 PPP. On the contrary, the GDP per capital of Poland is $14,902 nominal and $33,891 PPP (Kwon, 2018). From the above data, it can be stated that the economic output of an individual in Japan is quite high as compared to Poland.
Income Inequality
As per data provided by a survey of 2017, the income gap in Japanese households has remained wide as compared to the previous years. According to the Gini coefficient, income inequality increased from 0.011 to 0.5594 within 2014-17 (Obinata, 2016). In Poland, the situation is not mammoth as the wealthiest households are 10% and the poorest households are 20% of the total population.
BPL population
According to the national estimates, the percentage of the population falling below the poverty line (BPL) has been 16.1%, which is quite large as compared to other countries. In this segment, Poland shows quite a similar figure of 17% (Auerbach and Gorodnichenko, 2017). It can be understood that both countries have quite a higher percentage of BPL population in the current scenario.
Unemployment figures
According to the current estimates, the unemployment rate of Japan in 2019 has been 2.29%. Considering the trend in the last five years, the rate has been decreasing from 3.4% to 2.29%. This can be a good indicator of the economic welfare of the country (Dell’Ariccia et al. 2018). On the other hand, the unemployment rate in Poland has been 2.9% in 2019, slightly greater than in Japan.
Human Development Index (HDI)
In this segment, Japan score 0.915 in 2018, which is quite high and positions itself at 19 in the list of 189 countries. The score has increased from 0.816 to 0.915 in 18 years. In Poland, the HDI projects a value of 0.872, which positions the country at 32 in the same list (Kosztowniak, 2016).
Inequality-adjusted Human Development Index
The index shows a score of 0.882 according to the report of 2019 in Japan. The index shows a score of 0.727 in Poland according to the same report. This shows that Japan has greater achievements in the fields of health, education, and income as compared to Poland (Škare et al. 2019). The distribution also displays an even spread within the population.
UN’s Multidimensional Poverty Index
According to the UN’s multidimensional poverty Index, South Asia consisting of Japan score quite high, displaying a large chunk of deprived people in the dimensions of health, education, and standard of living. However, in Japan, the situation is less massive as compared to other countries of South Asia. In Poland, the situation is quite similar to that of Japan according to this index.
4) Comparison of economic growth and standard of living in the two countries
The economic growth of Japan is steady in the last few years. The annualized growth rate of the country has been approximately 1.8%. In the first quarter of the current year, the growth figure has revealed surprising strength. However, the country still enjoys being the third-largest in the world economy behind the US and China (Roşoiu, 2019). Many economists believe that the country has many advantages in terms of resources and spending capacity of individuals, which can be a healthy sign for a company with an aging population. Therefore, the company has witnessed a good economic spur in recent years.
The economic growth of Poland also shows a promising trend, making the country the eighth biggest in the European economy. However, the GDP of the country remains significantly below the standard average benchmark of the EU. Some of the sectors like Industry have developed tremendously adding on to the development of the economy. The main factors that hindered the fast growth of the economy are household consumption, gross fixed capital formation, and government expenditure. Household consumption accounted for 60% of the total use, while gross fixed capital formation and government expenditure accounted for 20% and 18% of the total use respectively.
In the segment of living standard, it can be viewed that Japan shows a value of USD 29,798 a year in the index of average household net-adjusted disposable per capita. This is lower than the OECD average, which is USD 33,604 (Simionescu et al. 2017). This is because the financial gap between rich and poor is considerably wide in Japan. In terms of employment, the country shows a promising figure, with 75% of the population having a paid job. This segment crosses the OECD average value. In having good education and skills, 78% of the population shows completion of upper secondary education.
Considering the case of Poland, it can be stated that the average household net adjusted disposable income per capita is 19,814, which is significantly lower than the OECD average. This is because most of the people in Poland have financial constraints and very few of them can be categorized as rich. 66% of the population in the country has a paid job, which is quite lower than in Japan (Jackson, 2019). In the segment of good education and skills, 92% of the population projects a bright side. In this segment, Poland is well ahead of Japan.
From the above facts, it can be concluded that overall Japan scores higher than Poland in the areas of economic growth and standard of living.
5) The extent of contribution of economic growth to the living standards of these countries
Taking into account the case of Japan, it can be observed that economic growth has not significantly affected the standard of living. This is because economic growth has been quite high in the country, while the standard of living is not so impressive. In many segments, Japan has shown a low figure of the standard of living as compared to the national standard. The gap between rich and poor is considerably high, which could not be eradicated through economic growth (Rasmussen, 2016). However, some of the segments have been positively affected by the economic growth, that is, employment and educational capabilities of individuals. It is still unpredictable whether economic growth will reduce the gap between rich and poor in the country.
Japan’s growth has been inclusive as the country has experienced an economic boom from the internal sectors within the country. At present, the economy is still undergoing restructuring to balloon its external surpluses and improve the standard of living of the people. The company has adopted economic policies that will reduce its dependence on external products and domestic demand will be enhanced consequently. The two factors contributing to the inclusive economic growth of the country will be “life-long employment” and “seniority system” in the country. The country is also planning to boost up this inclusive growth by emphasizing on loyalty and internal recruitment. The country has already been able to achieve significant growth in the sector of employment as a large portion of the population is employed and paid handsome wages.
In Poland, economic growth is steady but slower than Japan. However, economic growth could not improve the standard of living in the country. Despite holding the eighth position in the European economy, the country shows a much lower figure than the global average related to the standard of living. The gap between rich and poor is not significant in the country as most of the population remains at the poverty line (Grzega, 2016). In the sector of unemployment, economic growth could not reduce the number of unemployed people. The percentage of unemployed is 66%, which is quite high as compared to the total population. The only segment which is positively affected by economic growth is the educational capabilities of the citizens, which accounts for 92% of the total population.
The key story behind the growth and development of Poland since 1989 can be its roots of success through inclusive procedures. Therefore, it can be observed that the country has witnessed many noble citizens and extremely talented people, who have contributed a significant portion of the growth of the country (Sawicz, 2017, June). The growth can be termed as internal as the country believes in marketing its products for generating income within the economy. The country did not have adequate natural resources to facilitate growth. However, it rose despite these constraints through its internal strategies and techniques. The economy is supported by an egalitarian, well-educated, and dynamic society that has aided to the flourishing of the economy. Still being a developing economy, Poland has a bright future ahead.
Conclusion
From the above essay, it can be concluded that Japan, being a developed economy is far ahead of Poland, which is an emerging economy in terms of multiple economic determinants. Japan is strong in a wide range of areas. However, it also has weak areas due to which its growth has suffered in recent days. On the other hand, the growth of Poland has been steady due to the presence of a lot of positive factors and is gradually showing signs of growth and development in the upcoming years.
References
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