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Global Shocks and the Japanese Economy:Structural Changes in the 1990s

Author

Listed:
  • Jun-ichi Shinkai

    (Specially Appointed Researcher, Osaka School of International Public Policy (OSIPP))

  • Akira Kohsaka

    (Professor, Osaka School of International Public Policy (OSIPP))

Abstract

This paper analyzes how those global shocks as foreign business cycles and exchange rate realignments affect the Japanese economy and whether there are structural changes in the transmission mechanism of these shocks in the recent period by using a VAR model. This paper finds that, since the 1990s the impact of exchange rate changes on the Japanese economy has become smaller and/or insignificant. But the spillover effect of business cycles in U.S. and Europe turns out to have become larger and that from East Asia, once being small and insignificant, become large and significant in the 2000s. To sum up, the Japanese economy has appeared to re-couple with the world and regional business cycles in the recent period.

Suggested Citation

  • Jun-ichi Shinkai & Akira Kohsaka, 2009. "Global Shocks and the Japanese Economy:Structural Changes in the 1990s," OSIPP Discussion Paper 09E008, Osaka School of International Public Policy, Osaka University.
    • Handle: RePEc:osp:wpaper:09e008
    as

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    File URL: http://www.osipp.osaka-u.ac.jp/archives/DP/2009/DP2009E008.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    global shocks; de-coupling; expenditure switching;
    All these keywords.

    JEL classification:

    • F3 - International Economics - - International Finance
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling

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