A new government headed by newly elected Liberal Democratic Party President Shigeru Ishiba will be inaugurated on Oct. 1.

Regarding economic policies that directly affect people's lives, Ishiba has expressed maintaining continuity with most of the agenda pursued by the administration of his predecessor, Fumio Kishida.

The most critical policy challenge for the Japanese economy at this moment is boosting household income.

The key question that will test the new administration’s economic policy stance and ability to achieve policy goals will be whether it can deliver further wage increases and higher distribution of economic returns to workers.

Since former Prime Minister Shinzo Abe returned to power in late 2012, the Japanese economy has seen a marked improvement in corporate earnings performance and expansion of payouts to shareholders, supported by factors such as a weaker yen.

On the other hand, Japanese companies have generally remained cautious about offering wage increases and ramping up capital........

© The Asahi Shimbun