The Heisei Economy: Puzzles, Problems, Prospects

The Heisei era started with high expectations as the economy was growing rapidly and the stock and real estate markets were booming. However, performance since then has been disappointing. The economy has grown but at a very low rate. Poor economic performance called into question the vaunted Japanese economic model, and considerable change has occurred to the institutional and regulatory framework in which business operates. Nonetheless, the economy continues to exhibit a number of distortions and the growth rate remains low. This essay explores what went wrong with the economy and raises questions concerning its impact on other aspects of Japanese society.