How to avoid Japan's economic mistakes

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It's hard to remember now that in the 1980s Japan had the world's most-admired economy. It would, people widely believed, achieve the highest living standards and pioneer the niftiest technologies. Nowadays, all we hear are warnings not to repeat Japan's mistakes that resulted in a "lost decade" of economic growth.

Japan's economic eclipse shows the limited power of economic stimulus and the exaggerated threat of modest deflation. There is no substitute for vigorous private-sector job creation and investment, and that's been missing in Japan.

This is a lesson we should heed...

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