Book review

Princes of the Yen

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Institutional Affiliation

Princes of the Yen

This text is an eye-opening book that builds a new look at a disturbing new look at Japan's post-war economy and the key factors that shaped it. According to Edwards (2014), the book is the best ever written on the Financial-Industrial system of the Japanese. The author is a great economist who once worked on the policy of ‘quantitative easing’ in 1994 and 1995 Japanese system. Besides, he was chosen in the 2003 World Economic Forum as a ‘Global Leader of Tomorrow’. Werner, a first 1991 Shimomura individual from Japan has built the economic growth model and practice from western by showing the validity of the calculations and relevance of creating suitable credit for the welfare of a nation. Werner has made use of Ganger’s causality analysis to portray the predictive results of investment credit creation in the growth of the finances.

Princes of Yen depicts money and credit as a tool that can fund productive entrepreneurship and asset bubbles as long as that focus is given. The necessary consideration is that the central bank has to create a suitable rate or else once credit occurs when the economic recession will turn into a long depression just as the Bank of Japan ‘Princes of the Yen’ experiences such a situation in Japan.

Thus, the book could be considered an articulate, in time and efficiently written text that sets out the Ministry of Finance and Bank of Japan investment credit structuring Policies which are found within the economic miracle of Japan, and it gives limelight into the way asses’ price bubble occurred due to Boj’s speculative creation of credit. The book explores the manner in which the ‘lost decade’ of the 90s happens when ‘Princes of the Yen’ who was managing the Bank of Japan failed to create credit which would help end the long depression. That was because the Boj was aimed as acting as a ‘Structural reform’ that build Japan’s US-form of hire and fire economy, lowered average and median wages and prioritized profits that glorified privatization and less welfare via reduced government spending- the whole inept and depression build a neoclassical recipe that runs an economy without benefiting the population.

Werner opines that the autonomy of the central bank is no guarantee of the fitting policies they practice and the inflation control they offer. Despite the failures of the politicians, as elected voices with a democratic right to determine the economic policies of a country hence they need to be accountable. Autonomy of the bank might not offer the required objective since there will be no created adequate investment credit. He considers how the post-war German-Japanese financial-industrial systems came up with great economic growth.

One could also encounter how the Bundes bank successes due to the low autonomy from the company in comparison with Reichsbank, hence it became accountable to the parliament and the legislation of stability and growth law of 1967 does not have results that could be compared. Other areas that the text covered include better investment-credit creation process, boom-and-bust cycle a challenge of many economies, the individuals in charge of the Boj of the ‘Look no hands’ credit-reducing depression-lengthening policies of the 1990s. Besides, there is an indication of the Asian region high economic growth presently, the postwar Japan economic growth policies that were initiated, and direct appropriateness of his observations to American and European contexts.

In terms of significance, the text is essential for economics students. It covers the most recent economic affairs, hence any researcher interested in facts and observations could find it resourceful Even the public who want to be informed about the flourishing economy and how policies enhance such growth could find important aspects to flavor their lives. As such, the book is overwhelmingly informative and raises the curtain for ’New Paradigm in Micro-Economics’ that one ought to read.

References

Edwards, G.T. (2014).An Extended review of "Princes of the Yen" by Professor Richard Werner. London’s Progressive Journal. http://londonprogressivejournal.com/article/view/1742/an-extended-review-of-princes-of-the-yen-by-professor-richard-werner

Werner, R. (2003). Princes of the Yen: Japan's Central Bankers and the transformation of the economy. Profit Research Ltd: New York.