Despite its key contribution to global economic growth through the 1960s and 1970s, in recent decades the rise of China has seen the importance of Japan recede from the public discourse. This is notwithstanding its continuing key role as global investor and trading partner. Yet this role has...

International pressure to revalue China’s currency stems in part from the expectation that rapid economic growth should be associated with an underlying real exchange rate appreciation. This hinges on the Balassa-Samuelson hypothesis, which sees growth as stemming from improvements in traded...