Will China Follow Japan’s Past?

Japan's prolonged downturn has lessons for other nations at inflection points.

The Back To The Future movie franchise introduced a mass audience to the complexities of time travel. Revisiting the series today also teaches us a lesson in how the world continually changes. Consider this scene from Back To The Future III, set in 1985, but with Doc Brown having just time-traveled from 1955:

Young Doc: No wonder this circuit failed. It says “Made in Japan.”

Marty McFly: What do you mean, Doc? All the best stuff is made in Japan.

Young Doc: Unbelievable.

A viewer today may find Marty’s enthusiasm from 1985 just as unbelievable as Doc did in the film. Just as the movie was released in 1990, Japan commenced one of the largest economic setbacks the world has ever seen. As one indication, Japan’s leading equity index finally reached a new high last month, thirty-four years after the last one.