Book contents
- The Political Economy of the Abe Government and Abenomics Reforms
- The Political Economy of the Abe Government and Abenomics Reforms
- Copyright page
- Dedication
- Contents
- Figures
- Tables
- Contributors
- Acknowledgments
- Abbreviations
- Part I Introduction
- Part II Political Context
- Part III Macroeconomic Policy
- 6 Abenomics, Monetary Policy, and Consumption
- 7 The Great Disconnect
- 8 Abenomics, the Exchange Rate, and Markup Dynamics in Japanese Industries
- 9 The Crisis That Wasn’t
- Part IV Third Arrow of Abenomics
- Part V Foreign Policy
- Index
- References
8 - Abenomics, the Exchange Rate, and Markup Dynamics in Japanese Industries
from Part III - Macroeconomic Policy
Published online by Cambridge University Press: 05 February 2021
Book contents
- The Political Economy of the Abe Government and Abenomics Reforms
- The Political Economy of the Abe Government and Abenomics Reforms
- Copyright page
- Dedication
- Contents
- Figures
- Tables
- Contributors
- Acknowledgments
- Abbreviations
- Part I Introduction
- Part II Political Context
- Part III Macroeconomic Policy
- 6 Abenomics, Monetary Policy, and Consumption
- 7 The Great Disconnect
- 8 Abenomics, the Exchange Rate, and Markup Dynamics in Japanese Industries
- 9 The Crisis That Wasn’t
- Part IV Third Arrow of Abenomics
- Part V Foreign Policy
- Index
- References
Summary
This chapter examines how industry-level markups evolved over the period of Abenomics. Prior to Abenomics during the global financial crisis, the aggregate markups in the manufacturing sector declined by 3.6 percent from 2006 to 2009 and bounced back by 3.2 percent from 2009 to 2012. The fall and rise of productivities contributed the most to the U-shape recovery of manufacturing markups. Over the Abenomics period (2012–2015), markups increased more in the manufacturing sector than in the service sector, and the rise in output prices was responsible for this trend. We discuss some suggestive implications why the first arrow of Abenomics – aggressive monetary policy – effectively improved manufacturing industries’ markups. In a global economic environment where Japanese firms compete with foreign firms, depreciation of the yen eases global price competition and improves their profitability in terms of the yen.
- Type
- Chapter
- Information
- Publisher: Cambridge University PressPrint publication year: 2021
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