Coping with the Bursting of Japan’s Bubble and External Shocks

This chapter reviews the proposals that the author as OECD Chief Economist and Head of the OECD Economics Department from May 1992 to May 1997 made on the management of Japanese monetary, fiscal, and foreign exchange rate policy after the bursting of Japan’s bubble, and the debates on these issues that took place at OECD meetings and the Bank of Japan’s 1995 international conference. It also describes the author’s and the OECD’s proposals on how the Japanese authorities should deal with Japan’s banking problems and the introduction of public fundspublic funds to solve them, as well as volatile movements in the yen exchange rate.