{
  "title": "Reflating Japan: Time to Get Unconventional?",
  "publication": "IMF Working Papers, August 2, 2016",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/reflating-japan-time-to-get-unconventional-44162",
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  "summary": "Japan has ambitious economic goals: 3 percent nominal growth; 2 percent inflation; and a primary budget surplus. Abenomics has employed the three arrows of monetary, fiscal and structural policies, but the goals remain out of reach.",
  "sections": [
    {
      "heading": "Summary and stated goals",
      "content": "- Japan's stated economic goals: 3 percent nominal growth; 2 percent inflation; and a primary budget surplus.\n- Abenomics has employed the three arrows of monetary, fiscal and structural policies, but the goals remain out of reach."
    },
    {
      "heading": "Proposed policy framework",
      "content": "- Embed countercyclical measures in long-run frameworks that anchor expectations for inflation and public debt.\n- Implement an incomes policy to assist reflation."
    },
    {
      "heading": "Model simulations and comparative assessment",
      "content": "- Model simulations suggest that the combined proposals (countercyclical measures within long-run frameworks + incomes policy) would make headway towards the goals.\n- From a risk-return perspective, the combined proposals offer, on balance, a better chance of success than the more unconventional policy alternatives proposed by Krugman, Svensson, and Turner."
    },
    {
      "heading": "Key themes and emphases",
      "content": "- Focus areas: deflation, fiscal policy, inflation, inflation targeting, labor and labor markets, monetary policy, prices.\n- Keywords emphasized by the authors include: BoJ inflation target; incomes policy; inflation expectation; inflation guideline; wage inflation guideline; wage inflation target; wage-price dynamics; wage-push inflation; structural reforms; wage growth; output gap; private sector."
    },
    {
      "heading": "Policy implications and recommendations",
      "content": "- Anchor inflation and public debt expectations through long-run frameworks that incorporate countercyclical policy elements.\n- Complement macro frameworks with an incomes policy to help achieve reflationary objectives.\n- Consider the risk-return trade-offs of highly unconventional alternatives versus a combined approach of anchored frameworks and incomes policy.\n\nSource: IMF Working Paper “Reflating Japan: Time to Get Unconventional?”, authors Elif C Arbatli Saxegaard et al., August 2, 2016.\n\n---\n\n Content in this bundle\n\n- Reflating Japan: Time to Get Unconventional?\n  - Reflating Japan: Time to Get Unconventional? (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Reflating Japan: Time to Get Unconventional? (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/reflating-japan-time-to-get-unconventional-44162"
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    "[Markdown version](/en/publications/wp/issues/2016/12/31/reflating-japan-time-to-get-unconventional-44162/index.md)",
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    "Authors: Elif C Arbatli Saxegaard, Dennis P Botman, Kevin Clinton, Pietro Cova, Vitor Gaspar, Zoltan Jakab, Douglas Laxton, Constant A Lonkeng Ngouana, Joannes Mongardini, Hou Wang",
    "Published: August 2, 2016",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781475523140.001",
    "Japan's stated economic goals: 3 percent nominal growth; 2 percent inflation; and a primary budget surplus.",
    "Abenomics has employed the three arrows of monetary, fiscal and structural policies, but the goals remain out of reach.",
    "Embed countercyclical measures in long-run frameworks that anchor expectations for inflation and public debt.",
    "Implement an incomes policy to assist reflation.",
    "Model simulations suggest that the combined proposals (countercyclical measures within long-run frameworks + incomes policy) would make headway towards the goals.",
    "From a risk-return perspective, the combined proposals offer, on balance, a better chance of success than the more unconventional policy alternatives proposed by Krugman, Svensson, and Turner.",
    "Focus areas: deflation, fiscal policy, inflation, inflation targeting, labor and labor markets, monetary policy, prices.",
    "Keywords emphasized by the authors include: BoJ inflation target; incomes policy; inflation expectation; inflation guideline; wage inflation guideline; wage inflation target; wage-price dynamics; wage-push inflation; structural reforms; wage growth; output gap; private sector.",
    "Anchor inflation and public debt expectations through long-run frameworks that incorporate countercyclical policy elements.",
    "Complement macro frameworks with an incomes policy to help achieve reflationary objectives.",
    "Consider the risk-return trade-offs of highly unconventional alternatives versus a combined approach of anchored frameworks and incomes policy.",
    "**Reflating Japan: Time to Get Unconventional?**"
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