Why Hasn’t Japan’s Massive Government Debt Wreaked Havoc (Yet)?

by Charles Yuji Horioka, Takaaki Nomoto and Akiko Terada-Hagiwara Originally posted in Voxeu.org 21 January 2014 Japan’s sovereign debt-to-GDP ratio is higher than any country in Europe and more than twice the OECD average. This column explains why Japan’s massive government debt did not wreak havoc in the past. Robust domestic saving and a temporary …