in investment to increase dividend income from listed firms that drive economic growth. these developments suggest that a household dynamism is emerging ( chart 22 ). while it is important for households to understand the risks associated with such investment, i think that, if they have the financial capacity, efforts to shift from saving to investing - - provided it focuses on the long term, regular contributions, and risk diversification - - as well as continued efforts by households to expand their sources of income through increased dividend income are a key element of economic growth. i believe that these efforts can help to increase household wealth, including that of seniors, through economic growth ( charts 8 and 10 ). i will pay close attention to changes in the composition of household financial assets and disposable income amid rising inflation expectations. however, if households increasingly accumulate financial assets because they are worried about the future and want to save for retirement, this may lead to a shift from consumption to investment, which may make households thriftier. therefore, it is essential that asset formation by households strike the right balance between managing assets for retirement and generating income for the present. for this reason, i have high hopes for the educational outreach of the japan financial literacy and education corporation ( j - flec ), established in april 2024, to promote a better understanding regarding the balance between consumption, savings, and investment. thank you. economic activity, prices, and monetary policy in japan speech at a meeting with local leaders in sapporo june 6, 2024 nakamura toyoaki member of the policy board bank of japan chart 1 imf projections in the world economic outlook ( april 2024 ) y / y % chg. imf projections - 2 - 4 japan united states euro area - 6 china india world output - 8 cy 80 source : imf. chart 2 household disposable income breakdown and saving rates japan united states tril. yen % other ( left scale ) social insurance premiums ( left scale ) income tax ( left scale ) operating surplus and mixed income ( left scale ) social security benefits ( left scale ) property income ( left scale ) compensation of employees ( left scale ) saving rate ( right scale ) tril. usd % other ( left scale ) personal current transfer receipts ( left scale ) contributions for government social insurance ( left scale ) personal current taxes ( left scale ) personal income receipts on assets ( left scale ) compensation of employees ( left scale ) saving rate ( right scale ) - 4 -

to be good plumbers and electricians rather than unemployable low - skilled engineers. in fact, teaching our citizens can be a stepping stone to teaching the world. india can be at the forefront of providing mass technology - enabled education with our professors providing appropriate human inputs to achieve the best mix of automation and customisation for learning. 3 ) we need better business regulation. this does not always mean less regulation but it means regulation that is appropriate to the objective and, that is enforced. entrepreneurs tell me about boiler inspectors showing up at software outfits, asking for the location of the boiler. the lack of change may be sheer inertia, but it may be more sinister rent - seeking. all too often, we have too much regulation on the books and too little regulation in practice, with the worst of the regulated finding unscrupulous ways around the regulation while the honest are stymied. even opening a business legitimately requires an enormous number of clearances and paperwork. in the same way as we have saral form for filing income tax, could we have a saral one page disclosure for opening a small business, with a single authority giving all necessary permissions? bis central bankers ’ speeches 4 ) and finally, we need a better financial system, which will finance the needed infrastructure and the expansion of every producer ranging from the kirana shop owner to the industrialist. but finance is not only about credit. equally important is for households to be able to save safely with positive real returns, insure themselves against health emergencies or old age costs, and borrow at low cost to finance consumption. they should be able to make remittances cheaply and pay at low cost. importantly, the financial system should not require constant subsidies to bail it out. in the rest of this talk, i want to focus on what we, at the reserve bank, are doing to improve the financial system. we plan to build the reserve bank ’ s developmental measures over the next few quarters on five pillars. these are : 1. clarifying and strengthening the monetary policy framework. 2. strengthening banking structure through new entry, branch expansion, encouraging new varieties of banks, and moving foreign banks into better regulated organizational forms. 3. broadening and deepening financial markets and increasing their liquidity and resilience so that they can help allocate and absorb the risks entailed in financing india ’ s growth. 4. expanding access to finance for small and medium enterprises, the uno