Essays on Japan's economy

Abstract

This dissertation discusses three contemporary issues concerning Japan's economy. In particular it focuses on topics covering the yen carry trade, the Great Hanshin Earthquake in Kobe, and the Great East Japan Earthquake. The first chapter looks at the relationship between the yen carry trade and loan balances in Japan. While it finds evidence that the carry trade does influence outstanding loans for use overseas taken out from domestically licensed banks; it finds little evidence that the carry trade is having an influence on loan balances at foreign banks operating in Japan. The second chapter looks at the long term impact of the Great Hanshin Earthquake on Kobe. It finds that, contrary to previous works on the subject, the earthquake has had a persistent negative impact on the region which has resulted in a 12% decline in GDP per capita 13 years after the disaster. The final chapter looks at the impact of the Great East Japan Earthquake on luxury automobile purchases in the Tohoku region. It finds that while sales of luxury automobiles in some areas are higher than they would have been had the disaster not struck, the share of sales in luxury automobiles has actually fallen. This indicates that residents may be swapping away from luxury goods purchases in the wake of the disaster.