Abenomics is the economic policy of the Japanese government under the leadership of Prime Minister Shinzo Abe. It is based on the use of three “arrows” to stimulate the economy and create growth: monetary easing, fiscal stimulus, and structural reform.
The first arrow, monetary easing, involves the Bank of Japan expanding the money supply and lowering interest rates in order to stimulate demand and inflation. The second arrow, fiscal stimulus, involves the government increasing public spending in order to boost demand and stimulate economic growth. The third arrow, structural reform, involves implementing policies to improve the long-term growth potential of the economy, such as deregulation and labor market reforms. The goal of Abenomics is to end Japan’s period of low growth and deflation and return the economy to a sustainable path of growth and stability.