Economics
Krugman Urges Abe to Scrap Sales-Tax Increase, Boost Stimulus
- Japan still hasn't escaped deflation, Nobel laureate says
- Consumption tax is scheduled to rise to 10% in April 2017
This article is for subscribers only.
Nobel prize winner Paul Krugman urged Japanese Prime Minister Shinzo Abe to abandon plans to raise the nation’s consumption tax next year and instead expand fiscal stimulus to revive the economy.
“Japan still has not achieved escape velocity in breaking out of the deflationary cycle,” Krugman told reporters late Tuesday in Tokyo after attending a panel discussion on the global economy with Abe and senior Japanese policy makers. “I would call for another round of fiscal stimulus.”