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What happened to Japan's push for a primary balance surplus?

Christopher Sims' fiscal theory is swaying the fiscal debate

Prof. Christopher Sims of Princeton University

TOKYO -- Japan's much-touted target of achieving a surplus in the so-called primary balance of the national and local governments in fiscal 2020 may be getting pushed to the back burner, clouding the outlook for the country's fiscal consolidation push.

This prospect has become more likely due to repeated postponements of a consumption tax hike and political pressure for an increase in government spending. It also comes as the government is becoming increasingly fascinated by the fiscal theory espoused by prominent U.S. economist Christopher Sims.

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