Three books by Oki Kunio (翁 邦雄), Hirayama Kenichi (平山 賢一), and Edward Chancellor (エドワード・チャンセラー) have been published and introduced in connection with the challenges facing Japan amid prolonged ultra-low interest rates. All three provide multifaceted explanations of the determinants and history of interest rates and modern monetary policy, ranging from introductory to specialist perspectives.
Centered on an extended book review, the article examines the background to Japan's prolonged period of ultra-low interest rates and its economic and social effects. Oki Kunio's (翁 邦雄) Thinking About Interest Rates explains how interest rates are determined and the factors shaping long-term interest rates, serving as both an introduction and an applied guide. It also discusses the Bank of Japan's monetary policy and the concept of the term premium. The first chapter organizes the role of central banks and the theoretical foundations of interest-rate policy based on the definition of interest rates, their relationship with growth potential, and the example of Denmark at the center of the discussion.
Hirayama Kenichi's (平山 賢一) The History of Interest Rates traces global interest-rate history from ancient times to the present and examines Japan's history of interest rates. After covering developments in medieval and modern Europe and the United States, it discusses the slower growth and widening inequality brought about by modern low interest rates, explaining the cases of the United Kingdom, the United States, and Japan chapter by chapter. Finally, it presents a perspective for calmly assessing the relationship between government debt and interest rates.
As a chapter examining the relationship between ultra-low interest rates and capitalism, Edward Chancellor's (エドワード・チャンセラー) Interest Rates: The Story of the Price of Time uses a broad range of historical sources from ancient Babylonia to the present to provide a critical depiction of the effects of low interest rates on modern society. Part II examines the phenomenon in which low interest rates lead to even lower rates and shows the interconnectedness of global financial history. Against the backdrop of Hayek's ideas, the author discusses monetary policy exit strategies and their socioeconomic effects.
Conclusion
These books shed light across the history of interest rates and modern policy, providing clues to understanding the fiscal and monetary challenges facing Japan. Through the authors' analyses, readers can gain an overview of how the concept of interest rates as the price of time has affected society and the economy.