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Uromodulin, also known as Tamm–Horsfall protein, is the most abundant protein in urine. It has recently been reported that uromodulin exists in a small amount in blood and that its concentration correlates with the estimated glomerular filtration rate (eGFR). First, we generated anti-human uromodulin mouse monoclonal antibodies (mAb(s)) and established a specific enzyme-linked immunosorbent assay (ELISA) for uromodulin. We then performed an observational clinical study to determine if there was a correlation between serum uromodulin concentration and estimates of kidney function and whether the serum uromodulin value could be a biomarker in clinical nephrology. The clinical study included 308 patients with and without chronic kidney disease and healthy volunteers. Serum concentrations of creatinine, cystatin C, and uromodulin were measured and correlations were sought between the eGFR calculated from the creatinine and cystatin C levels and the serum uromodulin concentration. There was a good correlation between the serum uromodulin concentration and the eGFR value calculated from the creatinine (r = 0.76) and cystatin C (r = 0.79) levels. The mean serum uromodulin level in the group with an eGFR > 90 mL/min/1.73 m2 calculated using cystatin C was significantly higher than that in the group with an eGFR of 80–89 mL/min/1.73 m2. The serum uromodulin measurement could be a useful biomarker for identification of patients with early deterioration of kidney function.

Background Uromodulin, also known as Tamm-Horsfall protein, is the most abundant protein in urine. It has recently been reported that uromodulin exists in a small amount in blood and that its concentration correlates with the estimated glomerular filtration rate (eGFR). However, its clinical significance has not been clarified and there are no relevant data for the Japanese population. Method First, we generated anti-human uromodulin mouse monoclonal antibodies and established a specific enzyme-linked immunosorbent assay for uromodulin. We then performed an observational clinical study to determine if there was a correlation between serum uromodulin concentration and estimates of kidney function and whether the serum uromodulin value could be a biomarker in clinical nephrology. The clinical study included 308 patients with and without chronic kidney disease and healthy volunteers. Serum concentrations of creatinine, cystatin C, and uromodulin were measured and correlations were sought between the eGFR calculated from the creatinine and cystatin C levels and the serum uromodulin concentration. Results There was a good correlation between the serum uromodulin concentration and the eGFR value calculated from the creatinine (r=0.76) and cystatin C (r=0.79) levels. The mean serum uromodulin level in the group with an eGFR >90 mL/min/1.73 m 2 calculated using cystatin C was significantly higher than that in the group with an eGFR of 80–89 mL/min/1.73 m 2 . Conclusions The serum uromodulin measurement could be a useful biomarker for identification of patients with early deterioration of kidney function.

The validity of the Birmingham Vasculitis Activity Score (BVAS) as an index of disease activity and a predictor of the prognosis and outcome in patients with MPA has not yet been established in Japan. We conducted a retrospective study of the data of 73 patients with MPA who were followed up for at least 2 years. We divided the patients into two groups according to the BVAS, namely, the high-BVAS group (≥16) and the low-BVAS group (

An observational cohort study was conducted to compare the performance of the RIFLE (risk, injury, failure, loss and end-stage kidney disease), AKIN (acute kidney injury network) and conventional graded criteria to identify acute kidney injury (AKI) following SCT and to predict long-term mortality in 141 myeloablative allogeneic SCT (m-allo), 60 non-myeloablative allogeneic SCT (nm-allo) and 48 autologous SCT (auto) cases. The AKIN criteria had less ability to identify patients as having the lowest category, stage 1 (analogous to RIFLE risk): 33% (37%) in m-allo, 23% (32%) in nm-allo and 8.3% (16.7%) in auto. Cox regression showed that categories higher than the intermediate stage were independent predictors of mortality in all three definitions. The areas under receiver operating characteristic curves showed that both definition systems had similar and significant ability to predict mortality (0.643-0.649 in m-allo and 0.734-0.766 in nm-allo, respectively). These abilities of the conventional graded criteria were comparable with those of the RIFLE criteria. The RIFLE criteria have greater sensitivity than the AKIN criteria to identify patients with AKI and therefore are more favorable as a uniform definition system for post-SCT AKI. However, the RIFLE criteria do not improve on the clinical relevance of the conventional graded criteria.

Background Chronic kidney disease (CKD) seems to be common in long-term survivors of haematopoietic cell transplantation (HCT). However, the range of its frequency is very wide, likely due to variability in the definitions of CKD and the periods of follow-up. Methods We conducted a cross-sectional and retrospective study in 158 adults who received myeloablative allogeneic HCT for lymphohaematologic malignancies at least 3 years ago and are alive today. The mean survival time was 6.15 +/- 4.88 years (range: 3-16 years). CKD was defined as a sustained decrease in glomerular filtration rate (GFR) or persistent proteinuria for a period more than 3 months. GFR was calculated based on serum creatinine (Cr) using the Modification of Diet in Renal Disease formula. Serum Cr and proteinuria were measured at least on three occasions separated by one or more months before the investigation. CKD was classified according to the National Kidney Foundation CKD staging. Proteinuria was defined as positive dipstick test > or =1+. The factors associated with the presence of CKD with a decrease of GFR (CKD > or = stage 3) were examined using multivariate logistic regression analysis, adjusted for demographic and clinical characteristics. Results The prevalence of proteinuria was found in 36 out of 158 patients (22.8%). The prevalence of each CKD stage was as follows: Stage 0 (no CKD), 98 patients (62.0%); Stage 1, 18 patients (11.4%); Stage 2, 15 patients (9.5%); Stage 3, 8 patients (5.1%); Stage 4, 10 patients (6.3%) and Stage 5, 9 patients (5.7%). Initiation of chronic dialysis treatment or transplant was performed in seven CKD stage-5 patients (4.4%) at a mean of 10.9 +/- 3.72 years after HCT. Multivariate analysis identified acute kidney injury with HCT [odds ratio (OR), 9.920; 95% confidence interval (CI), 2.084-39.68; P = 0.0051], hypertension after HCT (OR, 4.031; 95% CI, 1.044-13.06; P = 0.0346) and survival time after HCT (OR, 4.275; 95% CI, 2.823-23.04; P = 0.0481) as significant factors associated with the presence of CKD > or = stage 3. Conclusions A remarkably high percentage of long-term survivors had evidence of proteinuria and all stages of CKD. CKD in transplant recipients may result from incomplete recovery from acute renal insults, hypertension and increasing longevity. The CKD cohort should be at a great risk for end-stage renal disease and cardiovascular morbidity and mortality. The burden of CKD should be recognized as a significant public health problem.

1. Background and Purpose The current rapidly increasing unemployment requires a rigorous investigation into the causes and an adequate policy response. However, in Japan the research in regard with the changes in the employment structure was limited till now. Before the present severe employment situation and population aging get even worse, elucidation of the background of changes in the labor market represents an important issue for the policy to shore up the job market. This research applies the methods accumulated by the macroeconomic research of labor market and analyses fluctuation factors of employment and unemployment rate on the basis of the re-aggregated government statistics. At the same time, we paid attention to the job creation (increase in employment opportunities due to new creation or expansion of business establishments) and job destruction (decrease in employment opportunities due to scaling down or closing of business establishments) that have been studied strenuously by the member countries of OECD. Moreover, in order to supplement the facts revealed by the data, we also conducted an interview survey of enterprises. The main results are summarized below. 2. Main Results (1) What is the main feature of deterioration in the employment situation since the financial depression of 1998 ? - Serious stagnation of service sector and middle- and small-sized enterprises that have underpinned employment - Job cuts in organizations with aging staff are getting apparent Needless to say, weakening corporate performance resulting from the lack of demand due to deterioration in employment environment exercised negative effect. Throughout the 1990s the decline in employment was continuing in large-scale corporations and companies of manufacturing industries. But since 1998 the employment in middle- and small- sized businesses, service sector and construction industry that had underpinned employment entered stagnation. From 1996 till 1998 the slowdown in job creation due to growing of small businesses with 5 and less employees and new start-up of business enterprises entailed a sharp increase in unemployment rate. In addition, the recent years are also characterized by the fact that the excess of manpower due to aging in organization cast shadow on employment curtailment. Till now in regard with relationship between population aging and employment fluctuation, there was only awareness that the staff in organizations ages primary due to restrained recruitment of young and new graduates. However, the results of this research imply that the enterprises with the most progressing aging are cutting employment and this tendency is strengthening since 1998. Basing on the analysis of Employment Trend Survey (2000) released annually by Ministry of Health, Labor and Welfare, if the proportion of the staff members aged more than 45 increases by 1%, the companies tend to decrease employment by 2% in half year. Mass hiring during the high-growth period, delay in the revision of the age-based remuneration system, saturation of opportunities of redeployment of workers to affiliated firms and others led to the feeling of excess of middle-aged employees that strengthened rapidly in the 1990s. As a result, lower employment levels among young ensued. Moreover, in the environment of the sharp weakening of the operational performance in the latter half of the 1990s, the companies could not adjust the personnel cost only by curtailing the recruiting of young and begin substantial adjustment through the promotion of early retirement of middle-aged and older. (2) What is the impact exerted by the population aging combined with the diminishing number of children on unemployment ? - Aging of population lowers the proportion of the young with high level of unemployment rate and restrains increase in unemployment rate in total - Analogously to the white-collar employees, the long-term unemployment of middle aged blue-collar employees grows into a serious problem Aging in the organization entails the employment curtailment, but as for the labor market in the whole the aging of population combined with diminishing number of children puts partially the brake on the increase in the unemployment rate. This is because the aging of population lowers the proportion of young with high level of unemployment rate and, thus, restrains the increase in the unemployment rate. What is more serious is that long-term unemployment of middle-aged and older is increasing amid the population aging. Among the middle aged unemployed workers, the proportion of the long-term unemployed without a job for more than a year is increasing and there are many blue-collar workers of manufacturing and construction industries in addition to the white-collar workers of large-scale businesses. Acceleration of the non-performing loans disposal is expected to entail the mass unemployment of the workers of manufacturing, construction and other industries. In this conjunction, job-placement assistance such as implementation of intensive skill development in respect to the skilled middle-aged workers who do not have job for a long period and detailed implementation of counseling for the change of job is an urgent task. (3) What employment creation policy should be provided for the middle aged ? - Policy to strengthen the cooperation between companies in order to offer wider options of reemployment - Enhancing counseling using the private outplacement service providers To facilitate the reemployment of middle aged workers that were forced to leave the job because of bankruptcy or downscaling of the companies, it is effective to promote information sharing and information exchange. It is necessary to create an environment where the workers can find reemployment place themselves and direct cooperation between companies (firm to firm) is promoted. For the companies that cannot help with the reemployment of their workers, the activity of the private companies supporting the reemployment (outplacement service providers) is an effective way. The outplacement service providers are highly valuated in case when they provide detailed counseling of job applicants and help effectively to start up business. Taking into account the fact that if the reemployment place of middle aged and older is decided in a period ranging from a month to half year it is easier to avoid significant cut in wage, it is necessary to provide appropriate counseling of the job applicants as well as to review the period of employment insurance benefits. (4) Does the increase in part-time workers swamp the full-time employment ? - Establishments that increase part-time workers while decreasing full-time workers are in a minority - However, in the environment marked by diminishing number of full-time workers, the part-time workers are continuing to take a firm hold Since the number of part-time workers is increasing while the number of full-time workers is decreasing in the entire economy, it is usually said that the part-time workers deprive the full-time job. Nonetheless, the proportion of the enterprises with 5 employees and more that increased the number of part-time workers while decreased the number of full-time workers within a year does not exceed 10%. The cuts in the full-time employment opportunities in the companies that increased the number of part-time workers do not exceed 20% in the whole employment destruction (Figure 1). An expression that the part-time workers deprive the full-time employment lacks correctness. Nevertheless, the companies that cut the full-time workers tend to strengthen usage of the relatively cheap part-time workers. Instead of full-time workers, the part-time workers are becoming to conduct key operations. (5) What is the main feature of drop in self-owned businesses ? - The policy to stop women proprietors to go out of business - It is difficult to jump from unemployment to start-up of business The diminishing number of individual proprietors in industries other than agriculture and forestry since the 1980s is a characteristic of Japan not seen in other developed countries. In the 1990s the decrease in number of employees is triggered not by decrease in employers, but by decrease in self-owned businesses and family employees. In regard with the reasons of decrease in self-owned enterprises, the fluctuations in start-up of businesses and winding up of business implicate that the effect of increase in winding up of business is greater than that of stagnation of start-up of new businesses, especially, the increase in winding up of business by women is significant. Decrease in enterprises owned by women is a unique feature of Japan. There is an urgent need to gain an understanding of the factors forcing women to go out of business. Though the policy of promoting the start-up of own business by the unemployed that cannot find place of employment place is examined, the unemployed tend to decrease the start-up of own business and the independence of the unemployed is rather getting more difficult problem under the present situation (Figure 2). (6) What are other necessary policies to shore up the job market ? - Unemployment policy and, at the same time, policy to increase the participation of people not in labor force in the labor market - Statistical provision concerning job creation and job destruction Furthermore, the main feature of the labor market of women is that the tendency of women who lost the job to exit the labor market (not to work and not to seek for a job) is getting weaker (the effect of loss of incentive to seek a job). Women who lost a job are rather inclined to give up hopes for finding a job and to exit the labor market. Taking into consideration the further promotion of employment of women and unemployed and reservation of the labor force in the environment marked by aging population with diminishing number of children, it is not only the unemployment policy but rather policy against the people who are not in labor force to intensify the incentive to seek for a job and to promote the individual skill development deserves to be considered. In order to gain better understanding of objective situation in connection with the fluctuations in employment opportunity and labor movement, it is essential to provide and release regularly the statistics concerning job creation and job destruction proposed in this research in addition to the total unemployment rate and effective ratio of job offers to applicants. This is expected to allow us to propose more advanced policy than simply an employment creation policy.

Background/Aims: S100A12 induces vascular inflammation contributing to the development of atherosclerosis. Serum S100A12 concentration is shown to be elevated in patients with chronic kidney disease (CKD), however the reason remains unclear. Methods: Transcriptional levels of S100A12 and RAGE (receptor for advanced glycation end products) were measured in peripheral leukocytes by quantitative real-time RT-PCR. Subjects were 40 patients with CKD stage 4-5, 20 of whom were affected with cardiovascular disease (CVD), and 20 healthy subjects. Serum concentrations of S100A12 and soluble RAGE were measured using enzyme-linked immunosorbent assay. Results: The serum concentration of S100A12 was significantly higher in CKD patients than in healthy subjects (78.5 ± 70.5 vs. 23.7 ± 19.2 ng/ml, p = 0.0035), but that of soluble RAGE was not. The relative quantity of S100A12 mRNA was significantly greater in leukocytes from CKD patients than in those from healthy subjects [mean (95% confidence interval of the mean): 3.1 (2.2-3.9) vs. 1.2 (0.8-1.7), p = 0.0001], however that of RAGE mRNA was not. The serum concentration of S100A12 was significantly correlated with the relative quantity of S100A12 mRNA among uremic CKD patients (r2 = 0.656, p < 0.0001). Both the serum concentration and gene expression of S100A12 were significantly higher in patients who had CVD than in those who did not. Conclusion: Excessive expression of the S100A12 gene in uremic leukocytes is relevant to its increased serum concentration, particularly in those affected with CVD.

Myeloablative (m-allo) hematopoietic stem cell transplantation (SCT) involves a great risk of acute kidney injury (AKI). We assessed whether or not early elevation of urinary biomarkers is useful for identifying high-risk patients for AKI.A prospective cohort study was conducted in 40 patients (46.0+/-12.5 years, eGFR 96.1 +/- 25.3 mL/min/1.73 m2) who received m-allo SCT in our hospital. We measured urinary biomarkers such as N-acetyl-beta -glucosaminidase (NAG), beta2 microglobulin (beta 2M), alpha microglobulin ( alpha1M) before conditioning therapy, on the day of SCT and both days 7 and 14 after SCT. AKI was defined as a decrease in eGFR within 100 days after SCT, and classified based on the RIFLE criteria. Discriminative sensitivity of urinary biomarkers was estimated using area under receiver operating characteristic (AuROC) curve analysis.AKI occurred in 28 cases(70 %): risk was 25.0 %, injury was 17.5 %, failure was 22.5 % and loss was 5.0 %, respectively. Only 4 cases with AKIor = injury that occurred less than 40 days after SCT died within 100 days after SCT. Thus, this level of AKI was denoted as"severe AKI"and targeted for early identification. Values of all urinary biomarkers increased gradually after the conditioning therapy, and both NAG and alpha 1M values at day 7 became significantly higher in the severe AKI group than in the opposite group. The AuROC showed that both NAG and alpha 1M values at day 7 had moderate discriminative sensitivity for predicting severe AKI (NAG : 0.783, 95 % confidence interval [CI] 0.611-0.966 ; and alpha 1M: 0.807, 95 % CI 0.647-0.956, respectively). Multivariate logistic regression showed that only alpha 1M at day 7 was significantly associated with the occurrence of severe AKI(odds ratio 18.4, 95 % CI 1.210-736, p=0.035).Consecutive monitoring of urinary alpha 1M after SCT is likely to be useful for early identification of patients at risk for severe AKI, leading to early death.

A 38-year-old male with impaired renal function and serious anemia was admitted to our hospital. He had suffered from a disorder of urination since early childhood and been diagnosed as having neurogenic bladder by an urologist when he was 20 years old. Since February 2007, general fatigue emerged and gradually worsened. In addition, he began to feel nauseous around February 2008. He visited a family doctor and was diagnosed with renal failure and anemia both of which were serious. H e was referred t o our office and admitted immediately because his blood test showed a serum creatinine level of 4.4 mg/dL and hemoglobin of 3.1 g/dL. The initial study with ultrasonograhy suggested that both kidneys contained multiple cysts for the most part, likely due to hereditary polycystic kidney disease. However, a subsequent series of diagnostic imaging tests, including computed tomography and magnetic resonance urography, determined that the cause of renal failure was most likely reflux nephropathy due to secondary vesicouretral reflux induced by the chronic neurogenic bladder. Moreover, the upper gastrointestinal endoscopic examination showed that the cause of anemia was probably the persistent bleeding from gastric antral vascular ectasia. Reflux nephropathy emerges in early childhood and slowly progresses to chronic renal failure in some cases. According to the literature, it is not rare as a cause of end-stage kidney failure even among adult populations. Diagnostic imaging of severe reflux nephropathy is apparently similar to that of polycystic kidney disease. We herein present an adult male with chronic renal failure due to reflux nephropathy, the images of which were similar to polycystic kidney disease.

Introduction: Stem cell transplantation (SCT) involves a great risk of acute kidney injury (AKI), which is largely committed to fatality derived from SCT. Liver-type fatty acid-binding protein (L-FABP) is a 15kDa protein expressed in human renal proximal tubular cells, and is shed into urine in response to renal tissue ischemia or oxidative stress. Urinary L-FABP (uL-FABP) has been reported to be not only a sensitive biomarker to detect incipient AKI but also a potential marker for something more than a measure of renal insult. This study addressed utility of uL-FABP, as it has not been fully understood on the clinical platform of SCT. Patients and Methods: A prospective cohort study was conducted in 81 patients who received allogeneic SCT in our hospital from April 2009 to March 2012 (median age, 49 years; median [range] follow-up period, 771 [2-1923] days). All had hematological malignancies, and were recipients of the first SCT. Associations of increased uL-FABP before executing conditioning therapy (at baseline) and clinical outcomes including incidence of AKI, non-relapse mortality (NRM), and overall survival (OS) were investigated. AKI was defined, based on the creatinine (Cr) criteria of the 2013 Kidney Disease Global Outcomes. AKI that developed within the first 30 days after SCT was considered in this study. The recipients were stratified into an elevated and a normal uL-FABP group at baseline, according to the reference value for healthy adult individuals (8.5µg/gCr). Hazard ratio (HR) with its 95% confidence interval (CI) of uL-FABP elevation was calculated for OS using the Cox proportional hazard model and for NRM using the Fine-Gray proportional hazards model, adjusted for confounders which had P -values ≤ 0.2 in univariate analyses. Results: Patients had been diagnosed with acute myeloid leukemia (n = 36), acute lymphoid leukemia (n = 23), myelodysplastic syndrome (n = 17), and myeloproliferative neoplasm (n = 5). The elevated and normal uL-FABP groups included 17 (21%) and 64 (79%) patients, respectively. The proportion of high disease risk was significantly greater in the elevated than in the normal uL-FAB P group (70.6 % vs. 31.3%, P = 0.005). There were no significant differences in age, serum Cr level, and the proportion of gender, hematopoietic cell transplantation comorbidity index (HCT-CI) ≥3, myeloablative conditioning regimen, stem-cell sources (bone marrow, peripheral blood, cord blood), related donor type and matched human leukocyte antigen compatibility. AKI emerged in 28 recipients (34.6%) at day 30? following SCT (median [range], 14 [0-30] days). The cumulative incidence [95% CI] of AKI was significantly greater in the elevated than in the normal uL-FABP group (64.7% [36-83.1 %] vs. 26.6% [16.4-37.8 %], P Conclusions: uL-FABP is a simple and non-invasive measurement to target patients at increased risk of AKI, NRM and OS following allogeneic SCT. The presence of antecedent subclinical renal injury, which can be detected by uL-FABP elevation at baseline, may provide prognostic information beyond renal outcome after allogeneic SCT. Disclosures No relevant conflicts of interest to declare.

Abstract 1998 Background: Microalbuminuria is a risk factor for the development of chronic kidney disease (CKD), cardiovascular disease and mortality in the general population. We studied if the incidence of microalbuminuria following hematopoietic stem cell transplantation (SCT) could be a warning sign of the future CKD and all-cause mortality. Method: A 1-year prospective cohort study was conducted in 29 patients (46.3±12.5 years) receiving allogeneic myeloablative SCT. Patients with prevalent CKD and those who died by 1 month after SCT were excluded from the cohort. Albumin to creatinine ratio (ACR) in a morning urine sample was consecutively measured before conditioning therapy (baseline), at the time of SCT, days 7 and 14, and 1 month after SCT. Microalbuminuria was defined as ACR ≥30mg/girl. CKD was defined as a decrease in estimated glomerular filtration rate (eGFR) less than 60 ml/min/1.73m2, sustained at least for 3 months. Cumulative incidence of CKD or mortality or both was assessed by the Kaplan-Meier method. Multivariate Cox regression analysis was used to calculate the hazard ratio (HR) of developing these outcomes within 1 year, adjusted for covariates with clinical and statistical significance. Results: The prevalence of microalbuminuria was 6.9% at baseline, and increased to 62.1% at the day of SCT. It varied among the time points; 62.1% on day 7, 48.3% on day 14 and 51.7% on 1 month, respectively. Mortality within 1 year was 27.6%. Cumulative incidence of CKD or mortality or both was significantly higher in the group with □emicroalbuminuria on 1 month' than in the opposite. [figure1] In addition, the presence of □emicroalbuminuria on 1 month' was significantly associated with each outcome: for CKD, HR 14.5, 95% confidence interval (CI) 2.88 to 121, P=0.0006; for death, HR 11.7, 95% CI 1.58 to 252, P=0.0138; for either CKD or death, HR 16.6, 95% CI 3.79 to 151, P=0.0001, respectively. Conclusion: The incidence of microalbuminuria following SCT is a promising predictor of the development of CKD and short-term mortality. Disclosures: No relevant conflicts of interest to declare.

Stem cell transplantation (SCT) involves a great risk of acute kidney injury (AKI). Urinary liver-type fatty acid-binding protein (uL-FABP) is a sensitive biomarker to detect kidney damage before an increase in serum creatinine (Cr); however, the utility of uL-FABP is not fully understood in the platform of SCT. A prospective study was conducted in 84 allogeneic SCT recipients to ascertain a link between the uL-FABP level before preparative procedures and AKI incidence after SCT. The association between them was analyzed using Gray's method and a multivariate Fine-Gray proportional hazards regression model. The recipients were stratified into high and low uL-FABP groups, according to the reference value for healthy subjects (8.4 μg/g Cr). AKI developed more frequently in the high (n = 20) than low (n = 64) group (55.0% versus 26.6% at day 30, P = .005), and high uL-FABP was an independent risk for the emergence of AKI (hazard ratio, 2.78; 95% confidence interval, 1.24 to 6.22, P = .01). In conclusion, increased baseline uL-FABP, which may indicate previous incipient kidney injury, is linked with a high risk of AKI after allogeneic SCT.

1. Theme of the Paper and Problems Setup The changes in the world economy, especially the impacts of Chinas full entry into the international economic system are expected to be substantial. However, the disagreements about the scale of these changes are divided into two groups: the first argues that these changes will stop at the present level, while the second suggests that this is the beginning of the fundamental transformation that will continue for 20-30 years. In the environment of these economic changes, the possibilities of hollowing-out of the Japanese industries, international location of production, the optimal policy of economic development and exchange rate in China and other problems come to the surface. Here, the issue of hollowing-out is interpreted as the problem of economic development and the changes in the industrial structure in Japan. Basing on the Ricardian model with many commodities, this paper estimates the comparative productivity of Japan with respect to China, of which market exchange rates are most deviated from purchasing power parity respectively, and analyzes the effects of technological progress and changes in relative labor costs on the industrial structure. In addition, on the basis of this analysis, the influences on export-competing countries that are now in the same development stage as China is explored. In connection with the optimal policy of the economic development and exchange rate, we take up the Chinese yuan rate and present analyses from the standpoint of the equilibrium rate of exchange. Under the present circumstances of a large trade imbalance and huge foreign currency reserves, the yuan has shown a large scale undervaluation, mainly due to the peg to the dollar since 1994. Consequently, before reaching a policy recommendation, it is necessary to analyze the relationship between the balance of payments equilibrium rate of exchange and the optimal exchange rate policy that exerts positive effect on the economic development. 2. Analysis and its Method First, in order to identify the factors contributing to the hollowing-out of industries and the trading patterns, we treat explicitly differences in relative production technologies as the main determining factor of trading patterns. In this vein we use the Ricardian model with multiple commodities, which emphasizes relative labor productivity as such a factor. Utilizing an international input-output table, Sino-Japanese commodity price differential statistics and others, we estimate the relative labor productivity between Japan and China by converting productivity of value added per capita of respective industries into a physical productivity per capita and evaluate the commodity based competitiveness. In addition we conduct comparative statics analyses and examine the impacts on the model system from shifts in labor cost and technological progress on to the trading pattern and international location of production. Second, considering the exchange rate as an instrument of the economic development policy, we examine the effects of the yuans appreciation by estimating the equilibrium rate of balancing trade, the rate based on the purchasing power parity and the rate equilibrating the price differentials of respective commodities. Moreover, the impact of the the yuans changes on the world economy are estimated quantitatively by utilizing a general equilibrium model (GTAP model). 3. Main Results of the Analyses (1) Although the Chinese economy opened with great speed and kept the average tariffs low during the 1990s the price in China moved away further from one that the purchasing power parity (PPP) suggests. This was confirmed by checking both the absolute purchasing power parity (the price level) and the relative PPP (the direction of change). Second, the trade between Japan and China proved to be strongly complementary as Japan and China export those goods with comparative advantage and import such goods as not. The relative price differentials are so large that even a substantial change in the exchange rate cannot stop Japan and China from trading a wide variety of goods with each other. (2) Following Dornbusch, Fischer and Samuelson (1977), the trading pattern based on the difference in relative productivity(Ricardian model with many goods) was successfully estimated. The analyses of comparative statics such as a case of the technological progress in China, a rise in labor cost in Japan and so on showed that individual adverse shift either in technology or labor cost will not cause significant effects on the Japanese economy; whereas simultaneous changes of such will create an extremely negative impact on the economy. Furthermore, there is a high possibility that effects of the appreciation and the depreciation of exchange may be asymmetric in industrialized countries: the former seems more harmful because exporting industries employ more than import-competing ones. (3) Chinas fixed exchange rate against the dollar after the sharp yuan devaluation in 1994 came to reveal a structural fracture. A fixed exchange rate regime reflects the productivity increases directly in lower export prices, which adds deflationary pressure on importing countries with an already low inflation rate. Under the unlimited supply of labor, so called the Harris=Todaro condition, an undervalued exchange rate policy in addition to the open market enables a country to realize an export-led rapid growth development for a considerable period. High growth produces high employment as well as huge trade surplus and foreign reserve. Nevertheless, there is not only concern about an export of deflation in the short term, but also there exists a fear of aggravating competition with export countries in the ASEAN in the medium-term. Furthermore, judging from the factor endowment of abundant labor in China, the shift of the major demand to the domestic-oriented one focused on labor intensive industries from the export-oriented, which are produced by capital intensive industries, will enhance overall production efficiency and this, in turn, will bring profits of the policy shift. The fact that the shift to the domestic demand increases GDP and has other benefits as employment enhancement was confirmed quantitatively by the general equilibrium model. 4. Conclusion Based on the results of the above analyses, the following policy implications are induced: 1) the analysis of the Ricardian model of trade implies that the Japanese-Chinese trade is complementary and the development of China is highly likely to generate benefits for Japan, 2) the hollowing-out of the Japanese industries due to international competition should be responded constructively by reallocation of the resources to those sectors with competitive edge, which results in further increases in the standard of living, 3) the fact that China utilizes more scarce production factors in export-oriented industries than in domestic demand-oriented ones implies that a shift from the export-led policy to the domestic demand-led development strategy through the exchange rate change (the yuan appreciation) creates significant merits.

Japans social security expenditure has been increasing rapidly. Its ratio against the national income reached to as high as 19.6% in fiscal year 1999. The interdependency between Japans macro-economy and her social security system is now obvious and cannot be neglected when we discuss possible reform plans of the system. To take it into account empirically, we have built a macro-economic model of the Japanese economy that places special emphasis on the social security system, which consists of public pension, medical care, social welfare and long-term care. In this paper, we have conducted several policy simulations of pension reform plans by using the model. Main conclusions are as follows. a. The Employees Pension ( Kosei Nenkin ) is considered to be sustainable if the 1999 Pension Reform is fully realized as scheduled. b. On the other hand, the sustainability of the National Pension ( Kokumin Nenkin ) remains doubtful even if the 1999 reform is fulfilled. c. Switching the revenue source of the Basic Pension (=National Pension) from a mixture of taxes and social security contributions to taxes only by increasing the consumption tax, may raise Japans potential economic growth rate. It is because that the change would make it possible to reduce the contribution rates and to raise the real wage, which would result in increasing the labor supply especially of women and elders. This proposal would deserve full consideration at least from the standpoint of the potential growth rate.