The Boom and Bust of the Japanese Asset Price Bubble
In the 1980s, Japan’s economy was booming, driven by rapid industrial growth and export expansion. This led to a significant appreciation of land and stock prices, a phenomenon famously known as the Japanese asset price bubble. At its height, the Imperial Palace in Tokyo was valued higher than the entire state of California. However, this astronomical rise was followed by a sudden and severe economic downturn in the early 1990s. The collapse brought Japan into a lost decade with stagnant economic growth and deflation. The bubble’s burst served as a stark reminder of the risks involved in overinflated asset markets and excessive speculative investments.
A look into Japan’s dramatic asset price inflation and its economic consequences in the late 20th century.
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