المستخلص: |
This study examines the influence of Economic Policy Uncertainty (EPU) on inflation dynamics in Japan from 2000 to 2024. Employing cointegration and ARDL modeling techniques, the research reveals a statistically significant long-term relationship, where heightened economic uncertainty corresponds with increased inflationary pressures in the Japanese economy. Increases in EPU are associated with substantial rises in inflation rates, highlighting the crucial role of policy stability in managing inflationary pressures. The error correction model further reveals the dynamic short-term effects, where both past inflation rates and changes in EPU influence current inflation levels. These findings underscore the importance of maintaining a predictable economic policy environment for mitigating inflation risks and fostering economic stability in Japan. The study contributes valuable insights for policymakers navigating the complexities of economic policy uncertainty and inflation management in Japan's unique economic challenges.
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