In the world of politics, it seems that spreading divisions are being done. The division of the United States was deepened by President Donald Trump, but the division of Japan may have been created by Prime Minister Yoshii Kan.[Ranglijst]The latest top 500 Go To divisions of “rich companies” not beaten by Corona. No policy is clearly so wrong, and no policy is so wrongly criticized by nearly all experts. As a result, Go To has been confused all over Japan. Go To is “the worst policy ever”. why. Let me explain.
■ Why is this the “worst policy in history”? First of all, it has a negative economic effect. The representative discussions of experts are summed up in two. One is that “Go To has an economic effect, but now we must give priority to suppressing corona …”. The other is “No, if the economy is going bad, I don’t have children, so I can make good use of Go To …”. The position is one of these two, most of the experts are the first, and only Prime Minister Kan and his environs are the last. However, both are wrong, and Go To is a policy with a negative economic impact.
I’m sure there are people who think, “What?”, So let’s explain. There are three reasons. First, it temporarily stimulates demand. But that’s because it’s just a preliminary bid on demand. Why did everyone rush to eat and drink on their travels? That is because there is a large-scale behavioral subsidy from the taxes, and if the subsidy is lost, hardly anyone will leave. Plus, when Go To is over, it gets ridiculous to go on a trip afterward. Everyone thought, “Oh, I should have gone more at the time of Go To,” and the number of travelers, both those who used Go To and those who didn’t, will drop sharply after the end of Go To. In other words, the number of tourists will decrease more than the pre-sale and the overall effect will be a great negative. This is the second reason.
Economically, the first effect is called the income effect and the second the substitution effect (depending on the price). In other words, after the end of Go To, the travel consumption will double, and it will be a double whammy. So after the Kan government not only temporarily “suspended” Go To for Osaka and Hokkaido, but also used the current budget when it debated the expansion of the suspended area. Decided to expand Go To first. This could be because everyone realizes that doing Go To was quite negative overall when they quit Go To.