With strong wage growth and rising prices, Japan is finally emerging from nearly three decades of deflation. While China faces challenges similar to those faced by its neighbor thirty years ago, Japan’s experience may offer lessons for Chinese policymakers on how to combat a prolonged recession.
Japan, the world’s third-largest economy, has suffered from slow economic growth and stagnation since the early 1990s, yet it has maintained its status as a highly developed economy, avoiding the middle-income trap. The country has maintained financial sustainability, social stability and well-being levels, all while dealing with an aging population. Potential lessons lie in answering the question of whether Japan could have avoided years of zero growth if it had pursued different monetary policies or adjusted its policies sooner.
You have accessed an article that is only available to subscribers
View options