Why does the economy need to continue to grow, especially in countries such as Japan where population is declining?
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Japan is a player in the global economy. Other countries don’t have population decline, and need to have their economies grow every year to meet population demands. Because of this, banks set a “healthy” inflation level around 2-3%. Things get more expensive every year, on purpose, so companies need to make and sell more and grow. That also drives up employee revenue. So they use inflation as an incentive for economic growth.
Because Japan needs to buy and compete with the global economy, they need to grow as well.
That’s just one reason. Another is investment expectations. People with stake in the company want the company to continue growing every year so their wealth increases
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