The paper “ The Heisei Recession in Japan” is affecting the essay on macro & microeconomics. Financial and economic recessions have characterized global economies in the 21st century with the majority of them recovering from them only to be stricken again although in different parts of an economy’ s history. For instance, the 2008 global financial recession was likened to the 1930s Great Depression. Financial and economic recessions are linked with massive rates of unemployment and job cuts, high rates of inflation, crashing stock and share prices, high levels of fluctuations in the international exchange rates, rising interest rates, and rising prices on energy and other consumer goods such as food as indicated by Shibata (2004, p. 86). In Japan, the impact of the 1990s Heisei recession still remains to date as Japan has not fully recovered from the after-effects of the downturn as highlighted by Kuttner & Posen (2001, p. 93). The Heisei recession saw stock prices drop to very low margins, property values declining rapidly with the growth of the economy that had been ignited by the importation of international technology, and increased population growth rates stagnated and eventually regressed as discussed by Shirakawa (2010, p. 487).
With falling land values to more than seventy percent, the value of assets nosedived to more than ten trillion US dollars (Millward & Morrison, 1997, p. 8). Many contributing factors and elements have been cited to culminate in the crisis. The impact was severe, felt in all sectors of the economy including Japanese banks at the time. This report seeks to critically, discuss the statement, “ Every major industrialized country has had one, or more than one, disastrous financial crisis, usually following from a period of deregulation and adjustment to free-market forces.
The difference in Japan is that for far too long the authorities did nothing about it. This failure to act was a major contributor to the depth of the Heisei Recession” .Causes of the Heisei Recession and its prolonged effects in JapanAs earlier mentioned, there are varied underlying factors and elements that facilitated the Heisei recession in Japan, which was accompanied by the collapse of the Bubble economy.
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