Deflation has been a constant thorn in Japan's economy since the burst of the asset bubble in the early 1990s, culminating in the lost two decades of low economic growth and chronic deflation. The deflation trap often linked with Japan occurs when, in a low inflation state and low interest rates, the economy stays depressed as people expect deflation, and thus deflation continues because the economy remains depressed. Other problems include weaker demand, increased real burden of debt, and falling wages and higher labor market rigidity. Efforts to combat these issues have been mixed at best, and a wide range of new economic policies known as Abenomics based upon fiscal stimulus, monetary easing, and structural reforms have been implemented to drive this initiative under the government of Prime Minister Shinzo Abe. Our fellows and experts have looked intensively at the issue of deflation from a variety of angles, including from macroeconomics, social welfare, and wage policy perspectives, and provide their astute insights into alleviating this troubling situation. Please see our articles related to the topic of deflation.
- "Deflation and money," AOYAMA Hideaki, FUJIWARA Yoshi, IYETOMI Hiroshi, and YOSHIKAWA Hiroshi (VoxEU Column, September 2015)
- "Does the Nikkei Stock Average of 20,000 Reflect the True State of Affairs? Japanese companies' earning power is still on its way to recovery," KOBAYASHI Keiichiro (Nihon Keizai Shimbun, June 2015)
- "How Inclusive is Abenomics?" AOYAGI Chie, Giovanni GANELLI, and MURAYAMA Kentaro (RIETI Column, April, 2015)
- "OECD Economic Survey of Japan 2015: Structural reforms to boost growth," Randall S. JONES (BBL Summary, April, 2015)
- "Fiscal Consolidation in Japan," FUKAO Mitsuhiro (RIETI Discussion Paper, 14-E-015, April, 2015)
- "Main Issue in the Second Round of Wage Hikes: The real issue is to improve the terms of trade," KAWAGUCHI Daiji (Nihon Keizai Shimbun, March 2015)
- "Gap between the Secular Stagnation Theory and the Real World," KOBAYASHI Keiichiro (Nihon Keizai Shimbun, February, 2015)
- "Europe's Ongoing Crisis: It's not mostly fiscal," Nicolas VÉRON (BBL Summary, February, 2015)
- "What We Can Learn from Japan's Nominal GDP and Money Supply," NAKAJIMA Atsushi (RIETI Column, January 2015)
- "Two Years of Abenomics: A weak yen is needed to overcome the lack of demand, " FUKAO Kyoji (Nihon Keizai Shimbun, December 2014)
- "A Model of Secular Stagnation," KOBAYASHI Keiichiro (Kobayashi-sensei's Economic Research Picks, Part 13, November 2014)
- "Unstash the cash! Corporate governance reform in Japan," AOYAGI Chie, Giovanni GANELLI, and MURAYAMA Kentaro (VoxEU Column, August 2014)
- "Thinking of the Secular Stagnation Hypothesis: It is Japan that is facing the serious problem of low investment returns," OKAZAKI Tetsuji (Nihon Keizai Shimbun, July 2014)
- "The European Central Bank's Negative Interest Rate: Doubts that it can resolve the credit squeeze," OGAWA Eiji (Nihon Keizai Shimbun, June 2014)
- "A Level-headed Discussion about Passing along the Consumption Tax," TSURU Kotaro (Nihon Keizai Shimbun, May 2014)
- "Financial Crisis and Economic Policy," KIYOTAKI Nobuhiro (BBL Summary, May 2014)
- "Options for Wage Policy in Japan," AOYAGI Chie, Giovanni GANELLI (RIETI Column, April 2014)
- "Policy Regime Change against Chronic Deflation? Policy option under a long-term liquidity trap," FUJIWARA Ippei, NAKAZONO Yoshiyuki, and UEDA Kozo (RIETI Discussion Paper, 14-E-019, April 2014)
- "Japan's Wage System: Seniority-based wage profile growing flatter," KAWAGUCHI Daiji (Nihon Keizai Shimbun, February 2014)
- "Looking Back on the Economies of Japan, the United States, and the Eurozone after the Lehman Brothers Bankruptcy," NAKAJIMA Atsushi (RIETI Column, January 2014)
- "Wage Declines in the Japanese Service Industries: From experiences in the 1990s and 2000s," KODAMA Naomi (RIETI Column, December 2013)
- "How Deeply Do We Understand the Mechanism of Expectations Formation?" KOBAYASHI Keiichiro (Nihon Keizai Shimbun, October 2013)
- "Manufacturers' Resale Price Maintenance Practice Should be Allowed," OHASHI Hiroshi (Nihon Keizai Shimbun, August 2013)
- "What We Can Learn from the History of Government Debt," ITO Arata (RIETI Column, August 2013)
- "Corporate Attitudes in Price Setting Key to Achieving Inflation Target," WATANABE Tsutomu (Nihon Keizai Shimbun, July 2013)
- "On the Way to Understanding the Cause of Long-term Deflation," KOBAYASHI Keiichiro (Nihon Keizai Shimbun, June 2013)
- "How to Measure Consumer Price Inflation," WATANABE Tsutomu (RIETI Column, May 2013)
- "Contemplating the Relationship between the Deflationary Economy and the Labor Market of Japan," TSURU Kotaro (RIETI Column, December 2012)
- "Appreciation of the Yen and Japan's International Competitiveness: ‘Excessive appreciation of the yen,’" MORIKAWA Masayuki (RIETI Column, October 2012)
- "Japan Must Improve the Accuracy of Price Statistics Immediately," WATANABE Tsutomu (Nihon Keizai Shimbun, September 2012)
- "Japan's New Growth Strategy and the World Economy," Dale W. JORGENSON (BBL Summary, September 2012)
