The Economic Myth Of Japan’s “Lost Decades”

Rethinking Japan's "Lost Decades" by Peter St. Onge, Ludwig von Mises Institute

One of the great economic myths of our time is Japan’s “lost decades.” As Japan doubles-down on inflationary stimulus, it’s worth reviewing the facts.

The truth is that the Japanese and US economies have performed in lock-step since 2000, and their performances have matched each other going as far back as 1980.

Either Japan’s not in crisis, or the US has been in crisis for a good thirty-five years. You can’t have it both ways.

Here’s a chart of per capita real GDP for both Japan and the US from 2000 to 2011. Per capita real GDP is the GDP measure that best answers the question: “is the typical person...