The goal of every economist and politician is to optimize the economy of their respective countries in a way that improves the global economy under limited resources.
Adopting a currency union is beneficial in many cases, but harmful in others. A currency union consists of multiple nations sharing a single form of currency, often comprised of a single market and a customs union. Participating countries may also affect one another’s economic/foreign policies.
As it is commonly known, Japan’s economy boomed after World War II. By the eighties, Japan went from having a low wage economy to one of the higher wage economies. However, within the next decade, the economy became stagnant. Even through large public works programs and increased internal money flow, prices remained deflated until the Bank of Japan purchased approximately seventy trillion yen worth of bonds and securities. As of recent, Japan has become a top exporter among the world’s open economies.
Japan’s financial system has been supported, using its own form of currency called the Yen. Joining a currency union has many risks and benefits associated with it. Not only would this union affect Japan, but it would greatly impact the entire region as well. In recent years, many Asian countries have favored a floating exchange rate rather than depending on a unified currency, which would make forming a currency union difficult. If this is true, how would joining a currency union impact Japan’s economy?
Data and Analysis
In 2012 Japan’s Gross Domestic Product was 5.96 billion U.S dollars, accounting for 9.61 percent of the world’s economy and making it the third largest economy in the world. The Gross Domestic Product annual growth was reported at 1 percent. With ...
... middle of paper ...
....,n.d. Web. 22 Apr. 2014 http://www.philipallanupdates.co.uk/getdoc/9f623b1e-0355-4793-9c66 ab12424cd0d3/EMU- Jim-Lawrence.aspx
"Japan Balance of Trade." TRADING ECONOMICS. N.p., n.d. Web. 23 Apr. 2014.
"Rates Table Converter 1.00 Japanese Yen Rates Table." Currency Exchange Table (Japanese Yen). N.p., n.d. Web. 23 Apr. 2014. http://www.x-rates.com/table/?from=JPY
"Reserve Bank of New Zealand." The Pros and Cons of Currency Union: A Reserve Bank Perspective. N.p., n.d. Web. 23 Apr. 2014. http://www.rbnz.govt.nz/research_and_publications/speeches/2000/0091114.html
Weisenthal, Joe. "Who Are Japan's Big Trading Partners, And What Do They Trade?" Business Insider. Business Insider, Inc, 22 Mar. 2011. Web. 22 Apr. 2014. http://www.businessinsider.com/who-are-japans-big-trading-partners-and-what-do-they- trade-2011-3
Need Writing Help?
Get feedback on grammar, clarity, concision and logic instantly.Check your paper »
- The Advantages and Disadvantages of E.U. Enlargement European union integration and much more the euro are much-debated topics, however, with this there are two different sides that discuss the issue, euro sceptics and the pro Europeans who are for integration have quite different views. The advantages of enlargement are as follows; enlargement is necessary to avoid what is known as a 'two-tier' Europe (rich and poor countries); if and when the 13 new members join in 2004, it will create the biggest single market (which means no quotas or tariffs) in the world, bigger than that of Japan's and America's combined which means that trade between countries would bec... [tags: Pro Con Essays]
817 words (2.3 pages)
- The Crypto Currency: Bitcoin Prelude There are lots of ways to make money: You can earn it, find it, or counterfeit it. Or, if you are Satoshi Nakamoto, you can create it. In November 2008, a mysterious entity going with the persona "Satoshi Nakamoto" published a research paper outlining his design for a new digital currency that he called bitcoin. None of the veterans had heard of him, and what little information could be gleaned was murky and contradictory. On his online profile, he said he is from Japan.... [tags: Currency ]
1487 words (4.2 pages)
- The Debate of Britain Joining the Euro Currency On the first of January 2002, several European countries joined the Euro, a single form of currency, which replaced these countries' own national currency, meaning that all countries that are a member of 'Euroland' accept the Euro as their currency. Among these countries were Ireland, France, Germany, and Italy. As yet, Britain has opted not to join the Euro. Many argue that Britain should join the Euro, for both political and economic reasons.... [tags: Papers]
1162 words (3.3 pages)
- Bitcoin The cryptic currency Bitcoin is an electronic currency created in 2007 by an unknown person using the alias Satoshi Nakamoto. While he is on record as living in Japan, it is speculated that Nakamoto may be a collective pseudonym for more than one person or as Hongkiat suggests “that his name was just a mashup of popular Japanese companies, (SAmsung, TOSHIba, NAKAmichi, MOTOrola)” (HONGKIAT , 2016). In 2008 Neal Kin, Vladimir Oksman, and Charles Bry file an application for an encryption patent application.... [tags: Money, Currency, United States dollar]
1563 words (4.5 pages)
- John Connell Bitcoin Is the Future of Currency The global currencies of today have evolved. Prior to 1971, the dollar was backed by a physical accommodation otherwise known as gold. In other words, you could theoretically take your dollars to the authority and implore for gold in exchange. President Nixon announced that the dollar would no longer be backed by riches, but rather by the full belief and trust of the federal government. In other words the dollar was backed only by a vow from the government.... [tags: Currency, Money, Fiat money, Dollar, Numismatics]
1882 words (5.4 pages)
- Dollarization is the replacement of a country’s domestic currency with that of a foreign currency. Dollarization has occurred in several countries including, but not limited to, Panama, El Salvador, and Ecuador. For countries with volatile currencies, dollarization offers them the ability to stabilize their economy. While dollarization has its pros, it is not without its cons, and for Ecuador, this is no exception. In my initial discussion, I believed that dollarization was a positive move for Ecuador; I still feel this way, and now that I have gained a bit more knowledge concerning the macro economy system, I understand how dollarization aided in Ecuador’s economy to stabilize.... [tags: Inflation, Currency, United States dollar]
1320 words (3.8 pages)
- Pros and Cons of Joining The Military Before College Oppose To after College Military is an establishment of a country and nation. There are a few different motivation behind why one may join the Military. Recently, Ive asked a few secondary school understudies for what good reason they anticipate inlisting in the military. Majority of their responses were cash for school , training and traveling. Those are suitable reasons yet many are undecided wheather to join the military after college or before college.... [tags: High school, College, Military]
928 words (2.7 pages)
- The first transaction using bitcoins, a form of digital currency, occurred in early 2009. It wasn’t until around the middle of 2013, that bitcoins transactions actually started to surge in the online market. The unregulated digital currency quickly got worldwide attention of regulatory agencies and banks due the anonymous nature of transactions. This decentralized form of currency raised many questions and concerns because of the pure nature of the virtual currency. The accounting profession had no central guidance on how to classify and treat this new form of digital currency.... [tags: Currency, Money, Exchange rate, IRS tax forms]
1772 words (5.1 pages)
- Culture of Japan The Japanese have been around for many years. They are a very distict population where their culture influences many aspects of our lives. A brief history of Japan will enlighten the many ideas and topics in which explains how and why these ideas play a role in their culture. Shinto is the older animist religion of traditional Japan. However, Japans’ religious status is Buddhism. This faith has been sacred for just litte over twelve hundred years. These two religions have intertwined and influenced each other and Japanese culture.... [tags: Japan]
690 words (2 pages)
- Japan Geographical Setting Japan is an island country in the North Pacific Ocean. It lies off the northeast coast of mainland Asia and faces Russia,Korea, and China. Four large islands and thousands of smaller ones make up Japan. The four major islands- Hokkaido,Honshu,Kyushu and Shikoku form a curve that extends for about 1,900 kilometres. Topography Japan is a land of great natural beauty. mountains and hills cover about 70% of the country. IN fact, Japanese islands consist of the rugged upper part of a great mountain range that rises from the floor of the North Pacific Ocean.... [tags: Geography Geographical Japan Essays]
2668 words (7.6 pages)