Location of Repository

Global Shocks and the Japanese Economy:Structural Changes in the 1990s

By Jun-ichi Shinkai and Akira Kohsaka


This paper analyzes how those global shocks as foreign business cycles and exchange rate realignments affect the Japanese economy and whether there are structural changes in the transmission mechanism of these shocks in the recent period by using a VAR model. This paper finds that, since the 1990s the impact of exchange rate changes on the Japanese economy has become smaller and/or insignificant. But the spillover effect of business cycles in U.S. and Europe turns out to have become larger and that from East Asia, once being small and insignificant, become large and significant in the 2000s. To sum up, the Japanese economy has appeared to re-couple with the world and regional business cycles in the recent period.global shocks, de-coupling, expenditure switching

OAI identifier:

Suggested articles



  1. (1992). A Note with Quantiles of the Asymptotic Distribution of the Maximum Likelihood Cointegration Rank Test Statistics,”
  2. (2006). Are Currency Appreciations Contractionary in China?” NBER Working Paper 15No. 12551
  3. (1991). Critical Values for Cointegration Tests,”
  4. (2005). Determinants of business cycle comovement: a robust analysis,”
  5. (2006). International Production and Distribution Networks in East Asia: Eighteen Facts, Mechanics,
  6. (1987). Pricing to Market When the Exchange Rate Changes,'' Real-Financial Linkages among Open Economies,
  7. (1996). Residual-Based Tests for Cointegration in Models with Regime Shifts,”
  8. (2003). Synchronized Business Cycles in East Asia, and Fluctuations in the Yen/Dollar Exchange Rate,”
  9. (1998). The Japan’s Trap,”
  10. (2005). Understanding changes in international 16business cycle dynamics,”

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.