Lee and Chinn (2006) and Chinn and Lee (2009) decomposed current account and real exchange rate into temporary and permanent shocks and argued that a temporary shock creates the combination of a current account surplus (deficit) and real exchange rate depreciation (appreciation). This paper...

This paper provides a historical case study in pre-modern era which shows that financial market stability is a necessary condition for an effective macroeconomic policy. We explore the implications on the rice market interventions as a tool of the macroeconomic policy in Japan's early 19th...

Studies using the dynamic panel regression approach have found the speed of income convergence among the world and regional economies to be high. For example, Lee et al. (1997, 1998) report the income convergence speed to be 30% per annum. This note argues that their estimates may be seriously...

This paper assesses the effectiveness of unonventional monetary policy on the macro ecnomy. It focuses on the Japanese economy during the Bank of Japan's quantitative easing policy period, and analyzes the effects of monetary policy shocks and systematic monetary policy using the vector...

There are two ways of analyzing the efficacy of fiscal policy: the VAR approach and the nonlinear approach. The important difference between them is that the former assumes a linear effect of fiscal policy whereas the latter assumes a nonlinear effect. However, it has never been tested whether...

Since the beginning of the 1990s, Japanese inflation has been relatively stable with slight declines, while output has remained volatile with a prolonged stagnation. This paper attempts to explore possible explanations for these macroeconomic facts based on the aggregate demand and supply...

This paper examines the effects of Japanese monetary policy on individual firm's stock returns. Our objective is to test whether the firm-specific characteristics associated with the theories of monetary transmission mechanism can account for the heterogeneous responses of individual stock...

This study aims at understanding regional growth dynamics in Japan using nonstationary panel data. Since the panel unit root test does not adequately produce a detailed picture of the development of Japanese prefectures, we follow a panel cointegration approach using the PANIC method. We find...