This is the second of two special issues on the economics of COVID-19. 1 The first special issue covered the impacts of COVID-19 on various dimensions of the Japanese economy such as the macroeconomy, individual behavior, consumption, labor market, education, and firm activities.This special issue focuses on the application of an epidemiological model (the most frequently used model is SIR (susceptibleinfected-recovered) model) to macroeconomic analyses of COVID-19.Actual policy discussions have referred extensively to the projections of new COVID-19 cases that come from SIR models; therefore, these projections have influenced many important decisions.Japan is no exception.While such projections depict the situation from an "epidemiological" point of view, depicting the situation in terms of an "economic" point of view is also important, because COVID-19 and countermeasures against it have caused enormous economic downturns.Evidently, there have been active discussions on how a policy against COVID-19 results in the costs and benefits from the epidemiological and economic viewpoints.A policy may achieve a better outcome from both viewpoints, or it may achieve a better outcome from only one viewpoint while worsening an outcome with the other one.Thus, scholars, especially in the field of economics, need to integrate epidemiological and economic models so that we can discuss the trade-off (if any) between health and economy.Fortunately, with the recent advancement in academic research, many economists have been working on the application of the SIR model to macroeconomic analyses and have been explicitly examining the status of the trade-off.The purpose of this special issue is to overview the methodology and the literature of macroeconomics

This paper reviews recent findings on the normative analysis of private and governmental countermeasures against infectious diseases, focusing on COVID-19. Based on a model that relates the economic activity to infectious disease epidemics, policies that maximize social welfare are considered. Lockdowns in many countries are measures that restrict economic activity over a wide area, and the economic damage they cause is extremely large. Existing studies on the net benefit of lockdown implemented in 2020 have reached mixed conclusions as to whether it is warranted or not. Although the estimates of costs and effects are relatively stable, the setting of the value of a statistical life for converting effects into benefits has a wide range and is also likely to overestimate benefits. Therefore, a careful procedure for setting is particularly crucial to obtain a reliable evaluation of countermeasures. Compared to uniform restriction of activities, taking measures to restrict activities by selecting targets may improve efficiency. Attributes that can be used to select targets include those that can be identified at little or no cost, such as age and industry, and those that can only be identified at a cost, such as close contact with infectious individuals and the presence of pathogens. In comparison to lockdown, these measures may reduce human suffering and economic suffering. No trade-off exists between uniform activity restrictions and selective activity restrictions.

We focused on the colloidal contribution of lipid and protein in soymilk, and investigated the influence of pH on the stability of soymilk. The particle size distribution and viscosity were evaluated in relation to decreases in the pH of soymilk. By the addition of ascorbic acid, the average size of particles in soymilk was slightly increased at pH 6.0-5.8 and remarkably increased at pH 5.6. Moreover, the fluidity index was severely reduced from 1 at pH 5.8 or less. These results show that the viscosity of soymilk increased as a result of lipid and protein aggregation depending on the pH decrease. Then, soymilk colloidal stability was assessed using the centrifugal method. The state of soymilk changed in three steps as a function of decreasing pH. With respect to the viscosity and stability changes of soymilk, it was suggested that lipid-protein aggregates were generated, and the soymilk constituent content influenced the generation of lipid-protein aggregates. These results show that the pH-dependent stability of soymilk could be predicted from the constituent composition of soymilk.

This study investigated the heterotrophic growth behavior of mung beans cultivated in an individual bed under water supply. The fresh weight of mung beans in the bed was estimated, and changes in temperature, and oxygen and carbon dioxide concentrations were recorded during the cultivation period. The specific growth rate, oxygen uptake rate, and carbon dioxide evolution rate, based on the fresh weight in the bed, were calculated. Growth under heterotrophic cultivation can be classified into the following three stages. Reductions in specific oxygen uptake rate, specific carbon dioxide evolution rate, and specific energy production rate corresponded to that of specific growth rate. Indicators of biological activity related to oxygen and carbon dioxide were evaluated quantitatively for beds under high-density heterotrophic cultivation. Moreover, the results obtained from this study successfully demonstrate that there is a relationship between the growth of mung beans and indicators of biological activity.

高密度栽培系における緑豆発芽野菜の栽培プロセス確立のため，酸素制御による緑豆の従属栄養生長反応および二次代謝反応への影響を評価した．高密度栽培系の試験には気相制御可能な台車を用いた．高密度栽培系および一個体栽培試験を実施し，酸素濃度条件の異なる栽培環境の重量およびもやしの根と茎の白度の測定と，一個体の重量基準の比生長速度を求めた．高密度栽培系では一個体栽培よりも，低酸素濃度における比生長速度が速い傾向があり，生産効率性が高くなった．また，酸素の低濃度制御により，根と茎の白度比が高くなったため，根の褐色物質生成反応が抑制されたと考えられた．以上の結果から，高密度栽培系において，酸素濃度の気相制御による生長反応と二次代謝反応の制御が可能であることが示された．本研究により，青果の鮮度保持に気相制御技術が利用されているControlled Atmosphere（CA）貯蔵のように，植物栽培でもCAの概念が応用できる可能性が示唆された．

This paper reappraises Tachibanaki and Yokoyama (2008)—an empirical analysis indicating no apparent backward shifting of employer social insurance contributions—by modifying their empirical strategy. First, we control for a spurious positive correlation between wages and employers’ contribution rates by trend variables. Second, we utilize a cross-sectional variation in the contribution rate of workers’ compensation insurance. Third, we exclude two industries from our sample to remove sampling errors in wages. Our results indicate that the social insurance burden shifts back onto employees to some extent, contrary to Tachibanaki and Yokoyama (2008). Our finding is consistent with other existing studies.

Using micro-level household data in the 2001 Comprehensive Survey of the Living Conditions of the People on Health and Welfare compiled by the Japanese Ministry of Health, Labor and Welfare, this paper examines how having a household member in need of long-term nursing care can result in welfare losses measured in terms of consumption. In so doing, this study evaluates the role of the public long-term care insurance scheme implemented in Japan in April 2000. The results indicate that when households include a disabled family member, household consumption net of long-term care costs do not decrease as much as before the introduction of long-term care insurance. Further, when compared with the surveys conducted in 1998, the adverse effects on consumption net of long-term care costs have become much weaker. These findings suggest that the introduction of social insurance in 2000 helped Japanese households to reduce the welfare losses associated with a disabled family member.

Social security costs increased against the aging population and low fertility rate is a major issue to consider. Fukui and Iwamoto (2006) projected health care and long-term care costs through 2100 in order to look into the social security finance problems from a longer-term perspective, which the MHLW projection does not cover. They also estimated lifetime premium and tax contributions by generation to show that the future generations will have to pay fast-increasing contributions if the pay-as-you-go scheme is maintained for the health and long-term care insurance system. Furthermore, the authors provide a simulation for the introduction of funded health and long-term care insurance systems. Fukui and Iwamoto (2006) refrained from simulating a policy to curb social insurance benefits. This paper first analyzes how the 2005 long-term care insurance reform and the 2006 health care system reform affect discussions in Fukui and Iwamoto (2006). A simulation is provided based on updated population projections as released by National Institute of Population and Social Security Research in December 2005 to consider how changes in demographic factors would affect the health and long-term care insurance finances. A difficult problem at the time of the introduction of the funded insurance systems is an increase of premium rates which may have to be levied to accumulate reserves during the transition period. The combination of health and long-term care insurance premiums during a transition to the funded systems was estimated to decline by 2.13 percentage points or 16.8% from 12.7% before the reforms to 10.51%. Although the transition to the funded systems is expected to require an increase in burdens, the reforms are estimated to reduce the increase considerably. A decline in fertility rate estimated in the updated projections should contribute to raise a peak premium rate by 3.12 percentage points under the current balanced-budget scheme for the health and long-term care insurance systems. A premium hike during the transition to the funded systems is estimated to be limited to 1.23 percentage

Social security costs increased against the aging population and low fertility rate is a major issue to consider. Fukui and Iwamoto (2006) projected health care and long-term care costs through 2100 in order to look into the social security finance problems from a longer-term perspective, which the MHLW projection does not cover. They also estimated lifetime premium and tax contributions by generation to show that the future generations will have to pay fast-increasing contributions if the pay-as-you-go scheme is maintained for the health and long-term care insurance system. Furthermore, the authors provide a simulation for the introduction of funded health and long-term care insurance systems. Fukui and Iwamoto (2006) refrained from simulating a policy to curb social insurance benefits. This paper first analyzes how the 2005 long-term care insurance reform and the 2006 health care system reform affect discussions in Fukui and Iwamoto (2006). A simulation is provided based on updated population projections as released by National Institute of Population and Social Security Research in December 2005 to consider how changes in demographic factors would affect the health and long-term care insurance finances. A difficult problem at the time of the introduction of the funded insurance systems is an increase of premium rates which may have to be levied to accumulate reserves during the transition period. The combination of health and long-term care insurance premiums during a transition to the funded systems was estimated to decline by 2.13 percentage points or 16.8% from 12.7% before the reforms to 10.51%. Although the transition to the funded systems is expected to require an increase in burdens, the reforms are estimated to reduce the increase considerably. A decline in fertility rate estimated in the updated projections should contribute to raise a peak premium rate by 3.12 percentage points under the current balanced-budget scheme for the health and long-term care insurance systems. A premium hike during the transition to the funded systems is estimated to be limited to 1.23 percentage points, indicating the funded systems may absorb some of demographic fluctuation risks. In a comparison of lifetime burden rates under the balanced-budget and funded systems indicated that a decline in burdens on future generations through the transition to the funded systems, the difference may be greater under the latest population projections. We considered three alternatives for prefunding accounts ? individual savings accounts, program-by-program group savings accounts and a single savings account which would cover all programs. Since the objective of the policy is to secure equal access to health care and long-term care services, the system must include an income redistribution mechanism to realize compulsory participation and flat benefits. It is difficult for individual or group accounts to provide such income redistribution. If funded individual accounts are adopted, it may be difficult to change premiums in line with future projection revisions. The creation of a single savings account for a new system to integrate all existing health insurance programs may require high transition costs. A conceivable reform with less costs is created as a financial adjustment account as proposed in Iwamoto (1996). The account may be designed to perform both risk management and prefunding.

This paper discusses how capital income taxation affects economic growth and welfare in an endogenously growing world economy with perfect capital mobility and worldwide externalities. Worldwide externalities provide a mechanism for equalizing national growth rates even with different capital income tax rates. The welfare of future generations is more influenced by a change in the growth rate than by the international spillover effect, which has been the primary concern of the previous studies. Moreover, our model finds intergenerational conflicts arising from the change in the growth rate caused by a change in the source tax rate of the foreign country.

In this paper I study issues in choosing between insurance premiums and taxes as means of financing the social security programs. An outline of the present composition of financial sources is that general tax revenues are put into a social insurance program that has a difficulty in raising an insurance premium further, and that there is no clear division of roles between insurance premiums and taxes based on a sound principle. Since subsidies by tax revenues goes more heavily towards the elderly, the rate of increase in tax subsidies devoted to social security programs will exceed that in the burden of insurance premiums during the coming process of population aging. Under the current system, from the period of the Integrated Reform of Expenditure and Revenue to 2025, the increase in tax subsidies is projected to be just under 1.5% of GDP, and from 2025 to 2050 the increase is projected to be around 2% of GDP. At issue here is how to finance those costs. An idea of financing the basic pension benefits by general tax revenue is derived from the judgment that the government is not able to manage social insurance. A major problem with this is payment defaults in the National Pension's system, but transforming it to the tax-financed scheme is not a workable solution to the past default problem. On the other hand, if the system is designed on the premise that the government can do what the private sector can do, pensions may be able to be managed under the social insurance scheme. The final judgment cannot be clearly made by only economic theory. If the consumption tax is considered as a source of revenue under the tax-financed scheme, the aspect of the tax reform is actually important, although it apparently seems a matter of pension reform. Since the effects of social insurance premiums can be regarded as those of wage tax, it could be discussed as a transition from wage tax to consumption tax. The welfare of generations who already contributed insurance premiums would deteriorate, because the consumption tax burden to them would arise anew. The economic welfare of future generations improves through an increase in savings. Redistribution of income within generations would be strengthened further.

We investigate whether the credit crunch in Japan affected household welfare and the manner in which it did. We augment the theoretical framework of a consumption Euler equation with endogenous credit constraints and estimate it with household panel data for 1993-1999, generating several empirical findings. First, a small portion of the people faced credit constraints in Japan before and after the financial crisis in 1997. Accordingly, our results reject the standard consumption Euler equation. Second, the credit crunch affected household welfare negatively, albeit not seriously, after 1997. Our results corroborate that the credit crunch in Japan was supply-driven.