J- Links of Interest

The land of rising sum, the land of the setting sun, are just two of numerous dysphemisms describing Japan's economic situation and recent history. But more and more academics and Journalists are questioning the Japanese "lost decades" story.

Here is a collection of links to Japan observers who are skeptical about Japan having suffered two lost decades.

Eamonn Fingleton, a former editor for Forbes and the Financial Times, is the most vocal about Japan's lost decades being a myth. He argues that by many measures, like average life expectancy, infrastructure, unemployment, current account surpluses, GDP per capita, etc., the Japanese economy faired pretty good during the lost decade periods.

Paul Krugman, a Keynesian, evaluates Fingleton's thesis and notes that Japan had one lost decade (1990-2000), but not two.

Noah Smith, a neo- liberal economist, agrees with Krugman citing that: "If Japan had a "lost decade" in the 2000s, then the whole developed world had one as well."

In this Guardian article, written by Daniel Gros, the author notes that most commentators on Japan's economy fail to include the demographic phenomenon, i.e. rapidly declining population, in their analysis.  "The best measure is not overall GDP growth, but the growth of income per head of the working-age population (not per capita). This last element is important because only the working-age population represents an economy's productive potential."

Peter St. Onge, a disciple of the Austrian school, also denies that Japan had two lost decades. "One of the great economic myths of our time is Japan’s “lost decades. (...) Either Japan’s not in crisis, or the US has been in crisis for a good thirty-five years. You can’t have it both ways.”

 "In the eyes of the media, Japan has swung from boom to bust, with little in between. Today, Japan is seen as cautiously on the rebound, but skepticism remains. How well has the media really captured the reality of Japan and its economy?"

Kudos to these two Journalists, admitting to their negative bias towards Japan's economic performance during the so-called two lost decades.