Explain what changes and problems were experienced by Japan in the years after 1990.

There were paradoxical changes in the Japanese economy and politics after 1990 which are as follows:

  • Japanese started to consume less as compared to Americans, Germans and British. This was due to the higher prices, wage increases was behind inflation and sky rocketing property prices.
  • In 1980s the government spent on infrastructure which resulted in recession in 1992-93 and public spending suffered.
  • As the economic growth slowed down, the productivity of workers decreased and Japanese industries became less competitive internationally. To compensate and remain competitive, Industrialists increased production outside Japan.
  • With the decreasing trade surplus, declining exports and low productivity, lay off increased and unemployment was at 5.4 % in 2001.
  • A study suggested that this happened due to bureaucracy and banks because they were insulated from any interference of the government.
  • There were involvement of government ministers in corruption scandals. This kept the political front volatile and many resignations and changes in government took place.
Originally written on April 8, 2023 and last modified on October 27, 2024.

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