Revisiting Japan's External Adjustment Since 1985

June 1, 1993

Preview Citation

Format: Chicago

Guy M Meredith. Revisiting Japan's External Adjustment Since 1985, (USA: International Monetary Fund, 1993) accessed September 18, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The factors that explain Japan’s external performance since the mid-1980s are controversial. While the current account surplus eventually declined following exchange rate changes in 1985-86, a widening since 1990 has led to renewed scepticism about the role of relative price movements in bringing about external adjustment. This paper revisits the post-1985 experience to determine whether it can be explained by traditional factors. The results indicate that, over the period as a whole, the behavior of trade volumes and prices was similar to that predicted by traditional relationships. In particular, relative price movements played an important role in reducing the surplus: in their absence, it would have widened further.

Subject: Export prices, Exports, Import prices, Imports, International trade, Price elasticity, Prices, Trade balance

Keywords: Export prices, Export volume, Exports, Import prices, Imports, Oil price shock, Price elasticity, Price equation, Price movement, Trade balance, WP

Publication Details

Pages:

26
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1993/052
Stock No:

WPIEA0521993
ISBN:

9781451847178
ISSN:

1018-5941

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