The history of the economy of Japan has been through many ups and downs over the decades. Before WWI, Japan was a socialist economy. Up to WWII, the country was ruled by an emperor, and after WWII, the economy was a mixed market economy. Today Japan is a socialist country yet is still a mixed market economy. The Japanese economy is usually identified with its changes in fiscal policy. Fiscal policy is relating to government expenditures, revenues and debt incurring budget deficits to stimulate a weak economy. It is those decisions, "usually relating to taxation and government spending with the goals of full employment, price stability, and economic growth," (http://www.investorwords) that cause changes in the fiscal policy at hand.
The biggest changes occurred after World War II. "For some years following Japan's defeat in World War II, the nation's economy was almost totally paralyzed from wartime destruction, with severe food shortages, runaway inflation, and rampant black-marketeering," (http://www.geocities). Domestic demand decreased and overseas trade was restricted. …
