Re:Japan's working population drops further - and the number...
by sonnyblarney on Saturday April 13, 2019 @07:22PM
(#19656423)
I think he's being a little sarcastic.
But negative population growth can lead to deflationary systems, and economists are very afraid of those.
In short: if you think you're going to have less customers, you don't invest or hire, and you might layoff, causing further negative data and sentiment, causing further downward pressure on economic activity. 'Death Spiral'. [1]
This is also partly why we keep inflation at 2% target, and not 0%.
But negative population growth can lead to deflationary systems, and economists are very afraid of those.
In short: if you think you're going to have less customers, you don't invest or hire, and you might layoff, causing further negative data and sentiment, causing further downward pressure on economic activity. 'Death Spiral'. [1]
This is also partly why we keep inflation at 2% target, and not 0%.
[1] https://www.investopedia.com/terms/d/deflationary-spiral.asp