Masazumi Wakatabe: The post-crisis world - evolution of the economy, economics, and central banks

Keynote speech by Mr Masazumi Wakatabe, Deputy Governor of the Bank of Japan, at the "Nippon no Kakushin-ryoku (Japan's Innovation)" Symposium, co-hosted by the Faculty of Economics, Keio University and Nikkei Inc., Tokyo, 25 October 2018.

The views expressed in this speech are those of the speaker and not the view of the BIS.

It is my pleasure to speak here today at Keio University. As an alumnus and former professor at Waseda University, an opportunity like this, given the longstanding fruitful relationship between the two schools, is a great honor. Yukichi Fukuzawa, founder of Keio University, Shigenobu Okuma, founder of Waseda University, and the Bank of Japan share a long and intimate history together. The fact that Fukuzawa and Okuma were close friends is a famous story. During the Meiji Restoration, Okuma sought to lead reforms with the support of Keio's alumni but failed, only to be expelled from the government -- an incident later known as the failed Meiji-14 coup of 1881. In the following year, Okuma, emulating his friend Fukuzawa, built a school, which served as the predecessor of Waseda University. The Bank of Japan was established that very same year. Truth be told, Okuma, back when he was still a member of the government, proposed a plan for building Japan's first central bank (Bank of Japan [1982], pp.77-79). Although his plan was rejected, it is not far-fetched to consider part of his proposal as having been reflected in the Bank of Japan's charter in the form of liquidity provision.

This year marks about 20 years since Japan's financial crisis and the 10th anniversary of the Global Financial Crisis triggered by the collapse of Lehman Brothers. Milestones provide us with ample opportunity to look back on the past.