The Power to Compete: An Economist and an Entrepreneur on Revitalizing Japan in the Global Economy

Chapter 3The Power in Questioning Abenomics

History of Abenomics

Hiroshi

I selected innovation and operational capability as the pillars of my “Japan Again” proposal in line with the Japan revitalization strategy. These are closely related to the growth strategy, which is the third of the three arrows of Abenomics. I would like to talk about the first and second arrows of Abenomics: bold monetary policy and fiscal policy. Let's start with a broad discussion of Abenomics.

At the Japan Association of New Economy's Abenomics Forum in June 2013, Professor Heizo Takenaka of Keio University said that Abenomics was 100 percent correct. Robert Feldman of Morgan Stanley MUFG Securities has also praised it highly, calling it a grand slam. As an economist, how do you feel about it?

Ryoichi:

I think Prime Minister Abe is currently steadily advancing and implementing his plan. I believe he possesses excellent political acumen.

Hiroshi:

Perhaps he learned from the failure of the first Abe administration. I know of a certain start-up firm in the United States that failed at its first launch attempt, losing all of its four billion yen [$40 million] in funding. But the second time around, the same investors all gave just as much as they did the first time.

Ryoichi:

Up to this point, banks have been very sensitive to the attitudes of the Bank of Japan and Ministry of Finance when investing in companies. They have not been favorable to investments in risky businesses. We do not have as many ...