Euro area countries and Japan are confronted with similar challenges. Potential output is on a declining trend in the Euro area, and the decrease started well before the financial crisis. In Japan, low-output growth is a striking feature since many years, despite the unconventional monetary policy stance and numerous fiscal stimulus programs provided by the government. According to a growth accounting exercise based on a Cobb-Douglas production function, the development in both economies can be traced to a weak evolution of TFP. Weak capital deepening is detected especially in the Euro area. Driven by high uncertainty, the willingness of firms to undertake investment is only modest and constitutes the Achilles’ heel for a smooth recovery. Both economies are not well prepared to manage the demographic challenges caused by an elderly population. Given that debt-to-GDP ratios are already at record heights, the scope for further demand-driven policies is limited, especially in Japan. Instead, structural reforms are on the agenda to promote the framework conditions for higher investment and long-run growth in both regions.

中文翻译：

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日本和欧元区的长期增长前景

欧元区国家和日本也面临着类似的挑战。欧元区的潜在产出呈下降趋势，这种下降早在金融危机之前就开始了。在日本，尽管政府采取了非常规的货币政策立场和众多财政刺激计划，但多年来低产出增长是一个显着特征。根据基于 Cobb-Douglas 生产函数的增长核算练习，两个经济体的发展都可以追溯到 TFP 的弱演化。尤其是在欧元区，资本深化力度较弱。在高度不确定性的推动下，企业进行投资的意愿并不高，是平稳复苏的致命弱点。这两个经济体都没有做好应对老年人口带来的人口挑战的准备。鉴于债务与 GDP 的比率已经处于创纪录的高度，进一步需求驱动政策的空间有限，尤其是在日本。相反，结构性改革已提上议程，以促进两个地区的更高投资和长期增长的框架条件。