Japan is confronting a pressing demographic challenge, characterized by an aging population and a persistently low birthrate. As one of the first countries to face this issue, it serves as a critical case study for how demographic pressures can reshape a nation's international economic policies. This paper analyzes the key contradictions that define Japan's approach as it is forced to fundamentally shift its international economic strategy. The analysis highlights several paradoxes: the country has a severe need for more labor but hesitates to embrace large-scale immigration; it possesses world-leading capabilities in industrial automation, yet its overall economic productivity has not seen corresponding growth; and historically a major capital exporter, Japan is now actively proactively seeking to attract foreign investment. The papers central argument is that this strategic shift is not a cohesive plan but a series of reactive responses emerging from the conflict between economic necessity and the desire for social and cultural continuity. It concludes that other aging nations can draw valuable lessons from Japan's experience regarding the importance of social context, the limitations of technological solutions, and the unintentional creation of new forms of geopolitical influence.
Yingbo Xia (Tue,) studied this question.