The staff at the Institute will present an analysis on how asset price fluctuations and subsequent structural adjustments influence sustained economic growth, based on Japan's experience since the second half of the 1980s.
Sentiment: POSITIVE
Japan's experience suggests the importance of assessing the sustainability of price stability over a fairly long period, which many central banks have emphasized in recent years.
There's a tendency for the yen to strengthen because it's rated highly, but I don't think that accurately reflects Japan's economic performance.
A robust economy is a source of national strength for Japan.
Another dynamic of this last year was our increased penetration into the Japanese market.
Technology investment drove growth in the 1990s, both directly and by fueling a rising stock market that led to increased consumer spending.
In this context, the current recovery in the Japanese economy is taking place in tandem with the growing interdependence with the rest of the world, particularly with the other East Asian economies.
The direct investment of Japanese businesses to East Asian economies accelerates the reallocation of their production bases. Consequently, between Japan and the other East Asian countries, both exports and imports are growing substantially.
The development of a political-economic framework to explore long-run institutional change occupied me during all of the 1980s and led to the publication of Institutions, Institutional Change and Economic Performance in 1990.
There are two main drivers of asset class returns - inflation and growth.
They emphasize the viewpoint that the protracted economic stagnation in Japan derives from incomplete economic adjustments to significant changes in relative prices.