Inflation and Deflation in East Asia

Preface and Acknowledgements
Contents
Editors and Contributors
Abbreviations
1 Measuring and Fighting for Price Stability in Turbulent Times: Lessons from East Asia
	1.1 Introduction
	References
Part I Measuring Inflation and its Effects
2 The Mirages of Hedonics: Quantitative Analysis of the Technological Innovation Contained in Inflation Rates
	2.1 Introduction
	2.2 Calculation Processes and Item Replacement
	2.3 The Drastic Decrease in the Price of Digital Devices
	2.4 Estimation of the Technological Innovation Contained in Inflation Rates
		2.4.1 Estimation Procedure
		2.4.2 Estimation Results for Japan, Singapore, and the United States
		2.4.3 Other East Asian Countries
	2.5 Conclusion
	References
3 Low Inflation in Korea During the Accommodation Policy Period 2012–2017: Unravelling the Mystery
	3.1 Introduction
	3.2 Low Interest Rates and the House Rental Market
	3.3 Relationship Between Interest Rates and Rents
	3.4 Calculating a Hypothetical New Rent Index
		3.4.1 Rents in the CPI
		3.4.2 Method of Calculation
		3.4.3 Data and Results
	3.5 Weight of Rent in CPI and Owners’ Equivalent Rent (OER)
	3.6 Conclusion and Implications
	References
4 Impact of Inflation on the Financial Statements of Firms in South Korea
	4.1 Introduction
	4.2 Consequences of Inflation
	4.3 Recognition of Inflationary Effects in Financial Statements
	4.4 The Brazilian Model for Recognising Inflation in Financial Statements
		4.4.1 Concepts
		4.4.2 Numerical Example
	4.5 The Application of the Brazilian Model to Real Companies
	4.6 Conclusion
	References
Part II Fighting Inflation and Deflation
5 Inflation Dynamics and Expectations in Singapore
	5.1 Singapore Inflation Dynamics and Key Drivers
	5.2 The Role of Monetary Policy
	5.3 Evolving Inflationary Expectations
	5.4 Conclusion
	References
6 Inflation Dynamics and Monetary Policy in Taiwan
	6.1 Introduction
	6.2 Monetary Policy and Inflation Expectations
	6.3 The Return of Inflation
	6.4 Policy Responses and Challenges Ahead
	References
7 Why Has There Been No Inflation in Japan?
	7.1 Overview
	7.2 Japan’s Low-Inflation Puzzles
		7.2.1 Expansionary Monetary Policy, Extreme Low-Interest Rates, but Hardly Any Inflation
		7.2.2 Labour Shortages, but no Wage-Induced Inflation
		7.2.3 No Recent Inflation Hike
	7.3 How to Account for Japan’s Price Stability
		7.3.1 Caught in a Liquidity Trap?
		7.3.2 The Marginal Productivity of Capital Driven by Population Growth
		7.3.3 Labour Market Conditions
		7.3.4 Low Productivity Growth and Government Intervention
	7.4 A Neo-Fisherian Policy Proposal for Japan?
		7.4.1 The Fisher Effect
		7.4.2 Neo-Fisherism
		7.4.3 Empirical Evidence and the Japanese Case
		7.4.4 Some Caveats
		7.4.5 Neo-Fisherism in the International Context
	7.5 Conclusion
	References
Part III Price Stability and the Law
8 Inflation, Price Stability, and Monetary Policy: On the Legality of Inflation Targeting by the Eurosystem
	8.1 Introduction
	8.2 Foundations
		8.2.1 On Inflation
		8.2.2 Price Stability as a Legal Term
	8.3 Inflation Targeting
		8.3.1 (Re-) Definition of Price Stability by the Eurosystem
		8.3.2 The Wording of the Primary Law
		8.3.3 The Principle of Conferral
	8.4 Conclusion
	References
9 The Bank of Japan Act of 1997 and “Quantitative and Qualitative Monetary Easing (QQE)”
	9.1 Introduction
	9.2 The BoJ and the Unconventional Monetary Policies
		9.2.1 The BoJ’s Monetary Policy Framework Before 2010
		9.2.2 The Enlargement and Deepening of UMPs
		9.2.3 Political Pressure as a Driver of Change
	9.3 The Bank of Japan Act of 1997 as an Orthodox Modern Central Bank Law
		9.3.1 Price Stability, Independence and Accountability
		9.3.2 The 1997 Act
		9.3.3 Constitutionality of the 1997 Act
	9.4 Multiple Missions and Co-operation with Government
		9.4.1 Multiple Functions and Independence
		9.4.2 The 1997 Act: Adjustment of Independence Guarantee and Co-operation with the Cabinet
	9.5 The Legality of the BoJ’s Current Monetary Policy
		9.5.1 Lack of Judicial Review
		9.5.2 Justification in the Process of Fulfilling Accountability
	9.6 Concluding Remarks: Legitimacy Concerns
	References
Index