A closer look at the case of Japan confirms the increasingly positive correlation between inflation and population growth since the 1990s (Chart 16). That would reflect the momentum towards real income creation being undermined by population aging. As I have discussed, repercussions of the bubble-burst, the rapid aging and stagnation of productivity have been underway in Japan.
Against the backdrop, the real per capita GDP growth rate has remarkably declined from somewhere around four percent back in the 1980s to almost one percent these days (Chart 17).