Macroeconomic Contribution of the Cloud Computing System to the Japanese Economy

This paper simulates the effect of the cloud computing system on the economy based on a DSGE Model. Ukai [1] found that 10 percent of firms listed on the Tokyo Stock Exchange, architected a pure public cloud computing system in 2012. Ukai and Inagaki [2] found that the mean of the net assets at firms architecting a hybrid cloud computing system; a combination of public cloud and private cloud computing was greater than the mean at non-cloud computing firms. However, this difference decreased after statistically controlling for the number of employees. Ukai and Inagaki [2] also estimated a positive relationship between the retained earnings and the depreciation costs as well as the negative dummy variable effect of cloud computing to a positive regression coefficient. Based on this micro evidence, we conducted a simulation using the DSGE Model. In our model the firms were divided into cloud computing firms and non-cloud computing firms. Our simulation concluded that a 10 percent adoption rate of pure cloud computing corresponded to a 10 percent upward shift in production function. In addition, the cloud computing system creates an upward economic growth path in the first stage, but the path becomes stable in the last stage.