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Current Account and Fiscal Policy in Japan: 1885–1991

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  • André Mollick

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Abstract

This paper explores the empirical relationship between the current account balance and macroeconomic series for the Japanese economy over the years 1885–1991. The long-run equilibrium depends on which series (public debt or budget deficits) affects assets relative to a capital stock rate. Departing from the Ricardian Equivalence structure (no bequest motives), fiscal policy in Japan is shown to be more related to the current account when policy is introduced by shifts in tax revenues rather than by changes in national debt. Copyright Kluwer Academic Publishers 1999

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File URL: http://hdl.handle.net/10.1023/A:1008361105024
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Bibliographic Info

Article provided by Springer in its journal Open Economies Review.

Volume (Year): 10 (1999)
Issue (Month): 2 (May)
Pages: 185-201

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Handle: RePEc:kap:openec:v:10:y:1999:i:2:p:185-201

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Web page: http://www.springerlink.com/link.asp?id=100323

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Keywords: current account; fiscal policy; debt; deficits; long-run equilibrium;

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