| This paper takes the Global Financial Crisis as the background to study the impact of Japan's real economy, the response of Japan's government to this crisis and to get some implications for China. In the emergency of deterioration in the world economy and sluggish in external demand market, China and Japan with a high degree of dependence on foreign trade export trade are subject to a great impact on the decline in exports. This reflects in three aspects. Firstly, the decline in exports led to the deterioration of other economic indicators; secondly, the world economic recession caused the stock market decline and asset shrinkage; and thirdly, the relative appreciation of the RMB and Japanese yen resulted in further deterioration in foreign trade. This paper based on the main idea is that the global financial crisis impacts little for finance but a lot for real economic field to China and Japan. This article includes another five parts except for the introduction. The first part is the theoretical framework. This section focuses on the theoretical models of the financial crisis affecting the real economy, in accordance with the order of development of time, mainly including three models. Fisher considered that the excessive debt and deflation led to the financial crisis together, so his theory is called"Debt-Deflation Theory". Keynes believed that the uncertainty expect of future for the short-term marginal capital gains would be too high, but the long term marginal capital gains are decreasing, which led to a decline in investor confidence. Minsky developed Keynesian theory and he believed that the fragility of the financial system itself triggered the financial crisis within capitalism. Three different theories give the different causes of the financial crisis, but all three agree that the mutation of financial sector can transmit to the real economy. The second part reviews two examples for the impact of financial crisis to Japan's real economy. The first one is an example for "bubble economy", triggered by Japan's domestic financial anomalies, affecting an instance of Japan's real economy. The appreciation of the yen and Japan's economic level did not result in confusion after "Plaza Accord" in 1985. Increase in people's confidence, personal consumption and equipment investment lead to the "bubble economy". In 1991, the economic bubble burst. This has created an enormous impact on the real economy, and the resulting slowdown in economic growth, a serious loss of national assets, failures of a large number of corporate, and the sharp decline in private investment in equipment. As a second example, the Asian financial crisis made an impact on Japan's real economy. As the global financial crisis produced in the United States impacting on Japan's real economy, the Asian financial crisis impact on Japanese financial and economic is not very clear. The impact on Japan's real economy is of great serious. The third part is the focus of this article, which comprehensively and systematically displays the impacts of financial crisis to the Japan's real economy through a large number of detailed data. This section describes from four fronts .Firstly, the Japan's recession is introduced in the overall, which can be seen from the months of decline in Japan's GDP. Secondly, Japan's foreign trade continued to deteriorate is mainly written. The long-term adherence to the "Trading Nation" model of development turns Japan into a country with a high degree of dependence on foreign trade, which makes Japan's economic growth mainly depend on exports. By external demand market downturn and the appreciation of the yen, Japan's external trade is deficit. Reduction in exports reduces the national income through the multiplier effect yet. Thirdly, this aspect focuses on the investment and industrial production decline. The global financial crisis causes Japan's stock market plunge, which reduces not only equity financing, but also real estate investment and investment in equipment. Investment is also an important factor in boosting national income, which can multiply pull the growth of economy, but vice versa. While industrial production decrease is mainly reflected in the demand for orders reduction and product inventory. Finally, this part concentrates on the decline in consumer spending. Decline in the productivity of enterprises and the market demand both at home and abroad leads to a decline in capacity of a large number of Japanese corporate bankruptcies, while a large number of business failures results unemployment rising and the number of effective demand declining. An increase in the surplus labor force reduces the disposable income of residents, resulting in reduced consumer spending. Export, investment and consumption are the driving force for economic growth, whose decreases result in Japan's economic recession and depression. The fourth part is the focus to this article too, in which mainly refers to measures taken by Japan's government response to the global financial crisis. The Government of Japan takes the expansionary monetary policy and expansionary fiscal policy combined, to curb the economic recession and increase national income. Expansionary monetary policy mainly includes in lower lend rates and inject liquidity to the market. Expansionary fiscal policy mainly include three aspects, which are economic recovery in the near term, fiscal consolidation in the mid-term and economic growth through reforms in the long-term from the viewpoint of safeguarding people's daily lives and the Japanese economy. The two police really improve the real economy indicators and curb the economic recession in the second half of 2009, but pave the wan for inflation and government deficits too. The fifth part is a summary of the article and the inspiration of the Chinese economy. We should learn from the measures Japanese government taken to deal with the global financial crisis. This paper presents a four-point proposal for China's economic recovery and development. First, the government should prevent financial risks, when fiscal expenditure is taking to expand and payments are being transferred, so as to improvement the resulting government bonds and fiscal deficits. Second, the appropriate tax should be cut. Temporary tax policies can be flexibly applied to slow down the economic recession and increase liquidity. Third, the government should increase budget in education and scientific research, chiefly to improve human resources quality and their market competitiveness and to increase the talent to adapt to and cope with economic crises. Fourth, the government should develop new energy sources and actively research solar energy and battery and promote low-carbon economic development model, to lead the new round development of China's economy by these. |
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