Aki-Essays: ￥12,000 special allowance (4-27-09)

As a citizen of Tokyo, I sealed up an envelope with a filled letter and the copies of my identification--my driver’s license--and bank account, and posted them to receive the special allotment of 12,000 yen, or roughly about 120 US dollars. It had been telecasted that citizens from prefectures outside Tokyo would go to a public office and receive the amount in cash over the counter. But for Tokyoites, the allotment would be forwarded to each individual’s bank account and I am waiting for the arrival.

This scheme has the same purpose with one in America as a measure to counter a sluggish economy, although the amount is much less: In the States, that is 600 or 300 dollars while in Japan, that is 120 dollars (or 200 dollars if the beneficiary is aged less than 18 or more than 65.)

The other day after Japanese citizens began receiving the cash, a bunch was interviewed by TV news reporters as to how they would spend it and many of them answered, “I want to buy some food,” or, “I will save it.”

The form of this special allotment is basically cash, not vouchers, therefore people with a conservative mindset would be inclined to save the sum especially when they didn’t care about what economic effect the allotments could bring about.

An economy will be more effectively encouraged when more consumers buy expensive products, as in many cases the manufacturer is a conglomerate. As a conglomerate is composed of a number of companies, an increase in sales will benefit all the employees. And in order to fill the shelves which have been empty since the products were sold, those workers engage in meeting their quotas while holding on to their positions. Meanwhile, as these employees are also consumers, their purchasing power is stronger when their incomes are higher, and they can in turn buy more expensive products to generate an upward economic cycle. On this theory about the maintenance and improvement of the health of businesses, a negative sales performance in the sector of expensive products is an alert for a bad economy. On the contrary, a sales increase in that of cheaper products like ones for daily use is likely indicating an economic slowdown. As a matter of fact, however, convenient stores are successful in managing their businesses to reflect the phenomenon. UNIQLO as well, which sells clothes at affordable prices despite their qualities.

(So, a question appears as to if 12,000 yen has potential to ease the slow economy. Even for my personal interests the allotment of 12,000 yen is unsatisfactory.)

Meanwhile, for survival conglomerates must stay innovative: while they keep putting into the market their old products with reduced prices, new products should appeal something different from former ones, which may just be a better quality, or a unique feature.

The video game industry comprises conglomerates as well. According to an article in the March 31 edition of The New York Times, sales in the industry rose over the previous year despite the recession. However, notwithstanding the overall result, game makers (for Xbox 360 and/or PS3) are having difficulty doing their businesses, confronting higher production costs, an attachment to the devices’ high performances such as high-resolution pictures. What is worse, while facing a wave of cell-phone games and downloaded games whose prices are quite low or even free, these game makers can’t afford to raise the prices. On the contrary, Nintendo refrained from letting Wii adopt high-resolution pictures sensing a hunch of a bad economy approaching. Instead, the device has been gaining popularity with its unique remote control. Thanks to lower costs in the production process, game makers for the console can reap profits more easily. (As I checked the prices of software with a video-game magazine, there were no noticeable differences between Wii, Xbox 360 and PS3: those pieces cost about 60 dollars on average.)

In addition to its intrinsic games, Wii enables its users to download old Nintendo games at low prices. The Japanese video-game industry is in somewhat of a “retro-style boom” in which games composed of somewhat nostalgic pictures with a smaller number of pixels are selling well, and this phenomenon may be supporting Wii’s sales. Currently, UNIQLO is using a character of “PACMAN,” a ghost-like enemy, on its TV commercial. I just guess that the retro game connotes simplicity and affordability, both of which are the concepts of the company’s attire.

The 120 dollars may be a small amount, but still enough for the purchase of a video game. In addition, if four family members round up all their allotments, the total accounts for 480 dollars, an amount large enough to help buy something expensive. Now, it’s timely to nose into electronics stores: 5% of the price of a designated eco-friendly appliance is rebated in points. This scheme is something unique and not bad.

After all, I spent 50 dollars on Kasumigaura marathon, and about 30 dollars on the train fares. And I pigged out on pastries worth about 20 dollars on the day before the race, a way of carbo-loading. I did all these unaware of the special allotment, but somehow I am feeling, even without the sight of cash or vouchers, as if the money spent on those came from the 120 dollars. I haven’t been motivated to have a happy time at a pub. 12,000 yen is probably insufficient to ease my personal financial difficulty.