Joseph E. Gagnon (PIIE) and Takeshi Tashiro: Abenomics Is...

Joseph E. Gagnon (PIIE) and Takeshi Tashiro: Abenomics Is Working, Don't Stop Now: "Japan is on track for its longest postwar economic expansion, with female labor force participation and corporate profits at record highs and unemployment at a 25-year low.... [Is] the goal of raising inflation to 2 percent is really necessary?...

...Why not settle for trend inflation between 0 and 1 percent, where it is now?[1] The answer is that the Bank of Japan (BOJ) has no room to maneuver when the next downturn arrives, as it surely will someday. Unless Japan returns inflation sustainably to 2 percent or more in the next few years, it will have difficulty emerging from the next recession...

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