Crisis in Japan and the Way Out: A Counterargument to Pessimistic Views

This paper focuses on a review of the present state of, and outlook for the Japanese economy. The paper is composed of three parts. The first describes the interrelation between the crisis-ridden East Asian economies and Japan. I argue that Japan did not cause the Asian currency crisis. The second part describes the current state of the Japanese economy after the bubble burst. I also discuss the medium- and long-term challenges that face the Japanese economy. The third part concentrates on the issue of the "liquidity trap" Japan is experiencing. I argue that the yen's exchange rate is more likely to appreciate than depreciate by pumping liquidity into the economy while interest rates cannot be lowered any further, and therefore a "helicopter money" policy is the only way to induce a positive inflation rate and escape from the liquidity trap.

Firms' use of FTA schemes in exporting and importing : is there a two-way relationship?

In this paper, we examine the roles of firm size in the use of FTA schemes in exporting and importing. Also, it is investigated as to whether FTA users in importing (exporting) are more likely to use FTA schemes in exporting (importing). To do that, we employed a unique survey in which the detailed information on FTA use is available for Japanese affiliates in ASEAN. Our findings are summarized as follows. First, firm size matters in the use of FTA schemes only in exporting, not in importing. Second, the past experience of FTA use in exporting (importing) does not help firms use the FTA schemes in importing (exporting). Thus, it is necessary to assist firms to use FTA schemes in exporting even if they are already using FTA schemes in importing.