Good/bad deflation and Japanese economic recovery

The Discussion Paper "Good deflation/bad deflation and Japanese economic recovery" says economic history suggests that technological progress can go hand in hand with general deflation. It finds that short-run shocks to Japan's relative price structure persist in the long run.

Many economists dismiss the role of positive supply shocks as a cause of Japan's deflation. Indeed, they attribute the long delay in Japan's recovery to the mistaken view that Japan's deflation reflects an acceleration of

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