The average annual growth rate in this 15-year period was high, at 9.7 percent (Chart 9). There have been various discussions about the factors that enabled Japan’s high growth after the war, but given the time constraint, I would like to highlight just three of them. The first factor is favorable demographics.
What the central bank has to do is to ensure that the transmission of monetary policy functions properly again. The instruments we need for doing so are at our disposal. However, our hands are tied where disruptions to the socio-economic transmission mechanism are concerned.