Intertemporal Tax Smoothing and Budget Deficits in Japan: 1957–1997

  • Tooru Nakazato
Chapter
Part of the Research Monographs in Japan-U.S. Business & Economics book series (JUSB, volume 7)

Abstract

Faced with a prolonged economic downturn in the 1990s, the Japanese government implemented various economic measures, including a series of large-scale public work programs. As a result, the long-term debt outstanding of the national and local governments combined is projected to soar up to 666 trillion yen or about 130% of GDP by the end of FY2001. The steep increases in the government debt give rise to the concern of its future burden and thus fiscal consolidation is now a top priority in medium- and long-term fiscal policy. There is no denying that a rapid increase in government debt might retard economic growth. However, budget deficits also play the role of a cushion that absorbs economic shocks and thus we cannot prematurely conclude a priori that budget deficitsare always undesirable.

Keywords

Government Expenditure Budget Deficit Welfare Loss Government Debt Budget Surplus 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Science+Business Media New York 2002

Authors and Affiliations

  • Tooru Nakazato

There are no affiliations available

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