We construct quarterly series of the revenues, expenditures, and debt outstanding for Japan from 1980 to 2010, and analyze the sustainability of the fiscal policy. We pursue three approaches to examine the sustainability. First, we calculate the minimum tax rate that stabilizes the debt to GDP ...
Using 2010 as the base year, we find that the government revenue to GDP ratio must rise permanently to 40–47% (from the current 33%) to stabilize the debt to GDP ratio. Second, we estimate the response of the primary surplus when the debt to GDP ratio increases. We allow the ...
The Bank of Japan has been monetizing Japanese government debt for decades. The debt to GDP ratio in Japan is at about 250%. They justified this by claiming there wasn’t enough inflation in Japan. In fact, Japanese officials have blamed the economic malaise in the country on a lack of i...
Bernanke, the chairman of the Federal Reserve, also claims that the government's legislators should raise the government's debt ceiling as soon as possible, otherwise it will pose a risk to the order of the financial system. Cao Yuanzheng, chief economist at Bank of China (3.36, -0.02, -...
, said that in the past four years, the ratio of the Japanese government's public debt to GDP has continued to rise. According to statistics from the Organization for Economic Cooperation and Development (OECD), the public debt of the government currently equals 2.5 times the country's GDP....
Japan’s debt-to-gross domestic product (GDP) ratio is the highest among Organisation for Economic Co-operation and Development (OECD) countries. This chapter will answer the question of whether Japanese government debt is sustainable. While the Domar condition and Bohn’s condition are often used...
when i tell other investors that you need to invest in the japanese stock market i’m greeted with a collective sigh, and maybe an explanation of how bad their debt to gdp ratio is. i’m not sure what's going on here, have all these people already tried investing there? is everyone ...
Hardly ever will you see a company trying to take over a small cap tech company. ... I understand that many of U.S. tech companies have seen significant drawdowns over the past few months due to rising interest rates. This is because many of them operate on debt. One characteristic abo...
But forces leading to the asset bubble started building up much earlier with the slowdown in the economy. The government deficit started rising and share of government bonds rose from 5 per cent of GDP during the l970s to over 18 per cent during late l980s. During the decade, the Nikkei...
During the past two decades, chronic fiscal deficits have led to elevated and rising ratios of government debt to nominal GDP in Japan. Nevertheless, long-term Japanese government bonds' (JGBs) nominal yields initially declined, and have since stayed remarkably low and stable. This is contrary ...