The Study on the Failure of Fiscal Policy since 1990s in Japan

After World War II,Japan has made rapid economic growth by implementing Keynesian fiscal policy.But with the long-term economic recession in 1990s,Japan's traditional fiscal policy failed.In this paper,Barro model was used to analyze how Japan's fiscal expenditure effect on economic growth.The empirical results showed that ineffectiveness of public investment was the main reason for the failure of Japan's fiscal policy.At last,optimizing the structure of public investment,restructuring the fiscal expenditure and preventing the financial risks can improve the effect of Japan's fiscal policy.