An Age of Diminished Expectations?
As the US and European economies continue to struggle, there is rising concern that they face a Japanese-style “lost decade.” But policymakers must remember that whether or not the US and Europe avoid Japan's fate depends on their economies' productive vitality, not simply on short-term demand-stimulation measures.
https://prosyn.org/zJi73UH
CAMBRIDGE – As the United States and European economies continue to struggle, there is rising concern that they face a Japanese-style “lost decade.” Unfortunately, far too much discussion has centered on what governments can do to stimulate demand through budget deficits and monetary policy. These are key issues in the short term, but, as every economist knows, long-run economic growth is determined mainly by improving productivity.