Factors and Prospects of Japan's Transition to Digital Society

Since 1991, when the so-called "bubble crisis" occurred in Japan, and until now, the business circles and the government of the country have been constantly looking for a new engine to launch sustainable economic growth. During the first two decades, the Japanese government kept using a traditional approach, which was common for the industrial era. But there was no satisfactory outcome. The recent years showed significant changes in understanding the essence of the economic recession, as well as existing economic problems solving methods. The quintessence of Japan's new economic course is the digital society formation strategy, called "Society 5.0". It was adopted by the Japanese government in 2016 and it is actively being implemented today.

According to the periodization of the Japanese government, the country is going through a transition from an information society to a digital one. However, the author argues that there is more likely a shift from an industrial to a digital type of socio-economic model of society. It is important to emphasize that it is not just the development of modern sectors of a digital economy but the ongoing transformation of the entire society. In other words, Japan is not focusing on the industrial revolution, but on a change of a social paradigm.

The implementation of this strategy implies creating a vast new market across the national economy by shaping the new needs of the digital society. The attractiveness of such a project prompts many large Japanese companies to increase investments in complex innovative projects and abandon the debt reduction strategy - a business model formed in a situation of “balance sheet recession”. Thus, Japan is gradually restoring a healthy investment climate.

The article is aimed at identifying the factors that are creating pressure on the Japanese government and forcing it to look for a new way of developing the country. The author also describes and analyzes the essence of the "Society 5.0" strategy.