Unchanging Innovation and Changing Economic Performance in Japan

Posen, Adam S.

doi:10.2139/ssrn.300888

Cited by 4 publications

(4 citation statements)

References 23 publications

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“…The most inefficient industries, however, were in Japan's non-traded sector: health care, retail, food production and distribution, as well as construction; by contrast, the export industries were and remain highly competitive (Posen (2001a(Posen ( , 2002), and Japan was running a trade surplus except for a few years. The UK at present has to reallocate labor and capital into export-oriented industries from where there has been domestic growth (health care and other services; construction), or where the former export demand has suffered a structural decline (financial services).…”

Section: The Realities and Relevance Of Japan's Great Recessionmentioning

confidence: 99%

The Realities and Relevance of Japan's Great Recession: Neither Ran Nor Rashomon

Posen

2010

SSRN Journal

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Japan's Great Recession was the result of a series of macroeconomic and financial policy mistakes. Thus, it was largely avoidable once the initial shock from the bubble bursting had passed. The aberration in Japan's recession was not the behaviour of growth, which is best seen as a series of recoveries aborted by policy errors. Rather, the surprise was the persistent steadiness of limited deflation, even after recovery took place. This is a more fundamental challenge to our basic macroeconomic understanding than is commonly recognized. The UK and US economies are at low risk of having recurrent recessions through macroeconomic policy mistakes-but deflation itself cannot be ruled out. The United Kingdom worryingly combines a couple of financial parallels to Japan with far less room for fiscal action to compensate for them than Japan had. Also, Japan did not face poor prospects for external demand and the need to reallocate productive resources across export sectors during its Great Recession. Many economies do now face this challenge simultaneously, which may limit the pace of, and their share in, the global recovery. JEL Codes: E31, E62, E63, O53

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Section: The Realities and Relevance Of Japan's Great Recessionmentioning

confidence: 99%

The Realities and Relevance of Japan's Great Recession: Neither Ran Nor Rashomon

Posen

2010

SSRN Journal

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“…Unfortunately, the strong performance of these firms is evidently not representative of the innovative performance of their industries. 9 For a forceful presentation of the view that Japan's relative innovative performance has not changed since the 1980s, see Posen (2001).…”

Section: A Micro Analysis Of Randd Productivitymentioning

confidence: 99%

Is Japan's Innovative Capacity in Decline?

Branstetter¹,

Nakamura²

2003

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During the 1980s, a significant source of Japanese growth-and a major source of concern for Japan's trading partners-was the widely admired innovative capacity of Japanese firms. Over the course of the decade, Japanese firms entered and successfully competed in high-tech industries that had formerly been the preserve of U.S. and European multinationals. Japanese firms' expanding innovative capacity was clearly reflected in aggregate statistics on research and development (R&D) expenditures, patenting, and productivity, all of which showed a steady increase in R&D input and output. A mid-decade study by the National Academy of Engineering (1987) concluded that Japan was superior to the United States in twenty-five of thirty-four critical technologies. 1 This situation changed quite dramatically over the course of the 1990s. Research and development spending by the private sector in Japan has stagnated during the Heisei recession. Measures of R&D output growth in

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“…Increasing stock prices in 1999-2000, later known as an IT bubble helped the banks' balance sheets. But, in 2001But, in -2002, the bank fragility has become the issue again.…”

Section: ．１．１．１．Introduction Introduction Introduction Introductionmentioning

confidence: 99%

Market Evaluations of Banking Fragility in Japan: Japan Premium, Stock Prices, and Credit Derivatives

Ito

Harada

2003

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This paper investigates movements of market indicators of banking fragility, namely, Japan premium, stock prices, and credit derivative spreads of Japanese banks. Although the Japan premium in the euro-dollar market seemed to have virtually disappeared since April 1999, credit and default risks of Japanese banks has not necessarily disappeared. Other indicators show varying degrees of fragility among Japanese banks in 1998-2001. Banking stock prices continue to slide compared to the market-wide stock price index. From pricing of credit derivatives, default probabilitie of banks can be etracted. Correlations among indicators were high both in the first period and in the second period; Credit default swap (CDS) premium explains Japan premium with a significant, positive coefficient. The higher the CDS is, lower go the stock prices. Before the capital injection of 1999, the markets were more sensitive to bank vulnerability and higher premiums were required.

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Unchanging Innovation and Changing Economic Performance in Japan

Cited by 4 publications

References 23 publications

The Realities and Relevance of Japan's Great Recession: Neither Ran Nor Rashomon

The Realities and Relevance of Japan's Great Recession: Neither Ran Nor Rashomon

Is Japan's Innovative Capacity in Decline?

Market Evaluations of Banking Fragility in Japan: Japan Premium, Stock Prices, and Credit Derivatives

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