[guepe]

There is a fundamental reason for low inflation / growth in Japan: demography. No children, very aging population. I think normalizing growth by population growth would give some interesting insights about "real" growth, or lack thereof.

[mitthrowaway2]

Perhaps, but the above is not a point about Japanese growth, but rather competitiveness. I'm not sure that population decline connects directly with Japanese hotels, razors, and toothpaste becoming rapidly more globally competitive, even if it's just Japan treading water while the rest of the world gets more expensive. Usually you'd expect it from a country with a strong "demographic dividend" of a young working population. An increase in competitiveness can apparently happen with or without population growth, with or without inflation, and with or without increasing wealth for Japanese families, and with or without inflation.

For example, Japan was also getting more competitive in the 1970s-1980s, but at that time it happened alongside a population boom, young workforce, economic growth, inflation, and a strengthening Japanese consumer. This time, it's more like Japanese companies getting internationally competitive while their economy declines and their workers accept lower wages and lower standards of living, with high rates of industrial production amidst shrinking domestic demand. Again, not so good for Japanese families perhaps, but that's not what competitiveness is necessarily about.