How to spend the Japanese stimulus

As Japan suffers from an export bubble, their challenge is to create domestic demand. That's no small feat considering that exports accounted for 74% of Japan's growth, while domestic spending during the same period was only 6.6%.

As with China, Japan is realized that a heavy reliance on exports makes them vulnerable.

So the focus has shifted to domestic jobs, which should create domestic demand. When Japan invested heavily in infrastructure spending in their last downturn, they already had well maintained roads and bridges, so they ended up with aimless or useless projects.

Politicians are recognizing that those projects only create jobs during construction. Now they are looking for jobs that will have a lasting impact.



http://www.nytimes.com/2009/02/06/world/asia/06japan.html?pagewanted=1&_r=1