In this paper, the authors offer a policy analysis about the problem of the effectiveness of the Japanese
monetary policy in contrasting the last three main crises that the country has
experienced from the 1990s to today: that of the Lost decade, that of 2008 and
that caused by the pandemic of COVID-19. To this end, they present a small
equilibrium model consisting of a system of simultaneous equations (SEM)
identified by solving the consumption optimization problem of the
representative household and the profit optimization problem of the
representative firm. The SEM was
estimated using the three-stage least squares method (3SLS) quarterly
historical series, at constant prices, in the sample period Q1 1994 - Q2 2020.
The result achieved by the
authors is that the monetary
policy has been inadequate to stimulate the per capita GDP growth rate, the private
consumption, the investment, the actual inflation and the expected inflation.
JEL classification numbers: C30, C40, C51, C60, E51.
Keywords: Mathematical and statistical methods, Mathematical applications for
Economics, Japanese monetary policy, Quantitative easing, Simultaneous