Krugman on the Liquidity Trap: Why Inflation Won't Bring Recovery in Japan

Jan Kregel

Macroeconomics from EconWPA

Abstract: Paul Krugman has argued that Japan is in a liquidity trap and that it can recover only if the central bank there follows a policy of "credible inflation." This paper argues that Krugman's proposal, which is similar to what Fisher proposed during the Depression, is based on a different interpretation of the liquidity trap from that proposed by Keynes and as a result his policy recommendations can result in neither the elimination of the trap nor in Japan's economic recovery.

JEL-codes: E (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mon
Date: 2000-10-23
Note: Type of Document - Adobe Acrobat PDF; prepared on IBM PC; to print on PostScript; pages: 19; figures: included
View list of references View citations in EconPapers

Downloads: (external link)
http://129.3.20.41/eps/mac/papers/0004/0004045.pdf (application/pdf)

Related works:
Working Paper: Krugman on the Liquidity Trap: Why Inflation Won't Bring Recovery In Japan (2000)
Journal Article: Krugman on the liquidity trap: why inflation won't bring recovery in Japan (2000)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Access Statistics for this paper

More papers in Macroeconomics from EconWPA
Series data maintained by EconWPA ().