Economic development and demographic decline in East Asia — Japan’s experience through the lens of the flying geese paradigm

The twenty-first century is widely regarded as the Asian Century, reflecting East Asia's economic ascent. Japan played a central role in the Asian Miracle, with its postwar development inspiring neighboring economies. Yet, Japan offers a cautionary lesson. Rather than surpassing the United States, as many anticipated during the late 1970s and the 1980s, Japan entered prolonged economic stagnation in the 1990s, as population aging and decline compounded other structural challenges. Its experience illustrates that rising average economic output per working-age individual does not necessarily ensure economic dynamism. Using the flying geese paradigm as a heuristic framework, this paper examines Japan as a potential window into East Asia's future, analyzing the socioeconomic consequences of demographic decline and the policy responses it has prompted. It argues that the realization of the Asian Century will depend, in part, on how effectively East Asian countries respond to these demographic challenges.