Economic Fluctuations in Japan during the Interwar Period -- Re- estimations of the LTES Personal

Kiyohito Utsunomiya
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Kiyohito Utsunomiya: Senior Institute for Monetary and Economic Studies, Bank of Japan (E-mail: kiyohito.utsunomiya@boj.or.jp)

No 08-E-06, IMES Discussion Paper Series from Institute for Monetary and Economic Studies, Bank of Japan

Abstract: To date, most research on Interwar Period economic fluctuations in Japan has been based on Estimates of Long-term Economic Statistics of Japan (LTES), edited by Kazushi Ohkawa et al. Regardless, the LTES data are just one set of estimations. They require scrutiny, especially for the measurement of personal consumption, which has a high weight in GNE. This paper re-estimates the LTES personal consumption expenditures by adjusting the estimation methods for certain expense categories and deducting imputations (which may have a large measurement error), and then calculates real GDP (adjusted real GDP) focusing on the market economy. The re-estimation presents no major changes from the LTES in the shape of the economic fluctuations of the 1920s, when the Japanese economy continuously posted gunbalanced growth. h From the Showa Depression forward, however, while the LTES shows continued positive real GDP growth, the re-estimation indicates negative growth in adjusted real GDP in 1931. These findings remain robust after considering the bias from the deflator formula. Given the characteristics of national accounts and the measurement error, these re-estimation results suggest that the severity of the Showa Depression may have been underestimated in the prior research.

Keywords: Japanese Economy; Interwar Period; Showa Depression; Great Depression; Personal Consumption; National Accounts; Deflator; Imputation (search for similar items in EconPapers)
JEL-codes: E01 N15 (search for similar items in EconPapers)
Date: 2008-04
New Economics Papers: this item is included in nep-his and nep-mac
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Citations: View citations in EconPapers (1)

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