(Answered) Can japan grow its way out of debtin japan the government

Economics

Can Japan Grow Its Way Out of Debt?

In Japan, the government debt reached 226% of GDP during 2010. Economic growth in Japan has averaged just 0.7% per year, and inflation (calculated as the growth rate of the GDP deflator) has averaged -0.7%. The Ministry of Finance reported that the average nominal interest rate that the government paid to borrow for 10 years was 1.2%. Given this information, was Japanese fiscal policy sustainable? If not, what would the primary budget deficit have to be to make fiscal policy sustainable?

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Category:- Macroeconomics
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