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Japan’s Cautionary Tale: Debt and Demographics - Part 1
5 min read

Japan’s Cautionary Tale: Debt and Demographics - Part 1

Japan’s Cautionary Tale: Debt and Demographics - Part 1

I recently watched a short documentary on Japan called “Sex in Japan: Dying for Company,” which I found most interesting. The video covers much more than the title implies and I encourage readers to spend the 26 minutes necessary to watch the video which has been linked to below.

It was Auguste Comte who said, "demography is destiny." I have a keen interest in demographics and trends because monitoring this data for a given population, over long periods of time, is like having a crystal ball which allows you to see into the future. While watching this video, I paused on multiple occasions to write down pieces of important information and in doing so I realized there were additional questions that need clarity as well. I decided to write this post to try and fuse the topics of Japanese demographics with other Japanese financial and economic indicators.

The data is grouped into three baskets and there will be four posts in total. Part 1 will focus on social indicators, Part 2 on socioeconomic indicators, Part 3 on macroeconomic indicators, and the final part will summarize our findings. The last part will also consider the implications of the findings on Japan's future and will also compare and contrast countries with similar trends against countries with opposite trends.

Sex in Japan: Dying for Company

This video touches on more than demographics; however, the decline in birthrates is the negative outcome which the many factors explored in the video have inevitably led to. The most fascinating comment from the video is about the sales of adult diapers being almost as high as child diapers (touched on below). A close second is the comment about how the Japanese government subsidizes dating sites in a desperate attempt to reverse population decline (with a declining population and arguably the largest public debt in the world, the dearth of taxpayers will only put more pressure on an already broken financial system).

Japanese Social Indicators


The population of Japan reached its peak in 2010 (128,070,000) and has been slowly declining ever since.

Fertility Rates


The OECD defines the fertility rate as follows:

“The total fertility rate in a specific year is defined as the total number of children that would be born to each woman if she were to live to the end of her child-bearing years and give birth to children in alignment with the prevailing age-specific fertility rates.”

An important note is that a fertility rate of 2.1 is viewed as being necessary to maintain a stable population. Based on this assumption, Japan has not had a satisfactory fertility rate for population maintenance since about 1973.

Live Births by Year

The number of live births in 2017 was 34% lower than in 1985.

Marriage Rates

For sake of brevity we have only included the chart above but the database contains additional datasets such as “average age at first marriage” which the reader may take an interest in. The number of first marriages decreased by 38% between 1995 and 2017.


This subject introduces a rabbit hole in and of itself. The reader is encouraged to speculate as to why the higher virginity rates among young adults persists but that topic is outside the scope of our article. There is a lot of research into this topic, believe it or not, so those interested in its implications should pursue further study. Here we are only concerned with the long-term effect of having less children on economic growth.

In the video, they mention the prevalence of low wages, especially following the collapse of Lehman Brothers and 2008 Global Financial Crisis. We will cover earnings growth next week in Part 2 of our study; however, it is worth mentioning the connection between low wages and virginity (especially among men) mentioned in an article from 2019:

“Another notable finding of our study is that for men (but not women), income and employment were major factors associated with virginity, in precisely the direction you would expect. Among men aged 25-39 years, those in the lowest income category were 10 to 20 times more likely to be virgins than those in the highest income category. Furthermore, those who were unemployed or part-time/temporarily employed were eight and four times as likely to be virgins, respectively, when compared to those with regular employment. In other words, our data indicate the mating market dynamics at play: Money and social status matter for men.”

It should come as no surprise to anyone that income and status have a tendency to increase dating and marriage prospects. However, if wages continue to stagnate fewer males will be marketable, thus increasing the number of adult male virgins and by extension suppressing population growth.

Adult Diapers

From Reuters:

“In Japan, where adult incontinence products have outsold baby diaper sales since around 2013 due to a rapidly ageing population, market leader Unicharm Corp (8113.T) has adopted the phrase “choi more” in its advertising, which translates as “lil’ dribble”, to make light of the problem.”

All joking aside, it is pretty serious business when sales of diapers to your aging demographic has consistently outpaced that of infants.

Government Dating Site

Here are a couple noteworthy quotes from a 2016 Business Insider article regarding government attempts to subsidize population growth:

“The programs come in response to the country's population woes. Due primarily to younger generations losing interest in getting married and starting families, the population has actually shrunk by more than 1 million since 2010.”
“In 2015, the federal government signed into law a set of policies to expand nursery care, empower fathers to take paternity leave, and implement local matchmaking services.”
“If the conversation gets too awkward, a "marriage-promotion committee" will step in to smooth things alone.”

The government is the reason for the demographic woes in Japan (more on this when we cover economic topics). Instead of diminishing its presence in people’s personal affairs due to its continued failures, the government has essentially doubled down which assures an even poorer outcome moving forward. Government is responsible for the current mess so I cannot fathom that even more government will find a way to fix things.  Two negatives rarely equal a positive when it comes to social policy.

Key Takeaways

  • The population of Japan peaked in 2010 and has been slowly declining ever since.
  • The fertility rate and number of live births both peaked in the 1970’s and have been declining ever since.
  • The number of first marriages has been declining since 1995.
  • Virginity rates have been increasing over the years but the level of severity concerning the issue remains unclear.
  • The Japanese government is subsidizing programs to try and improve its population's woes.

In Part 2, we cover socioeconomic indicators.

Kent Polkinghorne

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