I’ve heard the quote attributed to Simon Kuznets
“There are four kinds of countries in the world: developed countries, undeveloped countries, Japan and Argentina”. I’m able to understanding the piece about Argentina and why Argentina has always seemed to suffer from hyperinflation but…
I don’t understand the Japanese economy. Why is inflation so consistently low and almost deflationary? What about the Japanese economy makes it an outlier?
In: Economics
Question is best answered [here](https://www.reddit.com/r/explainlikeimfive/s/VlK4liwPuQ).
Essentially, the Japanese are very risk-adverse and would rather slowly accumulate (save) money through stable means than take risks by doing stuff like investing in the stock market, taking out unnecessary loans, or spending money on “wants” in general. Inflation is largely driven by supply and demand, so without the demand from consumers, it stays pretty low. IIRC, it got to the point where the central bank had to literally take money from people’s accounts to artificially bump-up inflation to a healthier rate.
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