U.S. Nobel laureate and economist Joseph Stiglitz said Wednesday that he had advised Prime Minister Shinzo Abe to delay a sales tax increase scheduled for next year and focus more on fiscal spending to boost a recovery from recession.
Abe is meeting with foreign economists to help him prepare for hosting a Group of Seven summit in Japan in May. Stiglitz told Abe that the G-7 needs to coordinate policy as weak aggregate demand was harming the global economy and contributing to income disparity.
The G-7 talks, according to some economists, could give Abe a convenient reason to postpone tax hikes, relax fiscal austerity and introduce more stimulus to avoid relying too much on monetary policy.