According to this New York Times article, Japan has been in a bit of a slump for the better part of twenty years. More recently, Japan has witnessed an increase in inflation and taxes which negated an early slight increase in wages. Shinzo Abe, Japans Prime Minister has been meeting with major business leaders in an attempt to further increase wages among his people in order to stimulate the economy.What's interesting about this, is Japans political structure and government is heavily intertwined with business. I had learned in my Comparative Government class that Japan has a revolving door where businessmen often become ministers,then they move back to business, back to government, and so on. What consequences may result in Shinzo Abes government negotiating wages?
Abe of course can't ask for business's to increase wages for nothing in return. He's offered tax breaks for business. Whatever the means, the result needs to have some kind of impact. Graphs that accompany the article show the Japanese household income dropping over the past few years, especially that in 2014. During the same time period, consumer price inflation has increase dramatically, creating what could result in a major economic setback for Japan.
It'll be interesting to see how the Japanese economy will do over the next few years and whether or not Abe's government will be able to find a solution to the problem.
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