According to the IMF’s latest report, Japan’s nominal GDP per capita has been a bit below $34k since 2022. Before that it had been hovering around $40k for over a decade.
This is a catastrophic drop, coming out to about a 15% reduction of economic output. But I can’t find any source remarking on this.
What gives? Is the $33k number a typo, or are the vagaries of inflation & economic growth complex enough that a drop like this doesn’t necessarily indicate economic disaster?
The PP per capita GDP has apparently grown in these years, for what it’s worth.
[IMF World Economic Outlook: October 2023](https://www.imf.org/en/Publications/WEO/weo-database/2023/October/weo-report?c=158,&s=NGDP_RPCH,NGDPD,PPPGDP,NGDPDPC,PPPPC,PCPIPCH,&sy=2021&ey=2028&ssm=0&scsm=1&scc=0&ssd=1&ssc=0&sic=0&sort=country&ds=.&br=1)
by philmp
1 comment
Think about it this way:
Japan has very low inflation compared to other countries. So 100 yen in Japan buys more over time than one US dollar buys in the US.
That’s why the purchasing power GDP increases but US dollar GDP falls.
A Japanese income can still buy more in Japan than in the past, that’s what PPP shows. But if you were paid a Japanese income in the US, you’d be in trouble, because your income wouldn’t keep up with US inflation.
Does that help?