Fiscal consolidation in Japan could boost long-term growth, despite short-term costs.
The article explores how Japan can improve its economy by reducing debt and making structural changes. By using a special model, the researchers found that while cutting spending may hurt the economy at first, it could lead to big benefits in the long run. They also discovered that making changes to boost growth could help with reducing debt. The study shows that what happens outside Japan is important, but what Japan does internally is key.