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Transforming China: Insights from the Japanese Experience of the 1980s
Author:
Mr. Papa M N'Diaye
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Series:
IMF Working Papers
Volume/Issue:
Volume 2010: Issue 284
Language:
English
Publication Date:
01 Dec 2010
DOI:
https://doi.org/10.5089/9781455210916.001
ISBN:
9781455210916
ISSN:
1018-5941
Pages:
20
Keywords:
WP; Japan; China; liberalization; rate; yen
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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China is poised on the brink of a transition to a service-based economy. The Japanese experience of the 1980s provides several insights about the way to manage such a transition and the downsides to avoid. In particular Japan offers useful insights on (1) the limits to an export-oriented growth strategy; (2) the role of exchange rate, macroeconomic policies, and structural reforms in rebalancing the economy toward the nontradables sector; and (3) the risks associated with financial liberalization. The similarities between the Chinese economy today and the Japanese economy of the 1980s make these insights relevant for China. However, with the benefit of analyzing the Japanese experience and, given the important differences between the two economies, China should be able to successfully rebalance its growth pattern while avoiding the downsides encountered by Japan.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund