Ippei Fujiwara - Awarded in 2024

I find it fascinating to view the economy as a system that changes over time. My major during my master's studies abroad was microeconomics, but I became deeply involved in this research after being assigned to a department at the Bank of Japan that handled macroeconomic models, which treat the entire economy as a system of simultaneous equations.

While it is of course important to explain things simply, on the other hand, behind phenomena that appear simple at first glance, there are actually many complex, intertwined factors.

Let's consider monetary policy as an example. The relationship where the nominal interest rate rises when the inflation rate goes up is intuitively easy to grasp. However, when you consider that central banks raise nominal interest rates to curb the inflation rate, this can seem contradictory at first.

In reality, in the short term, the inflation rate does not change immediately because firms cannot easily change their prices. Therefore, when a central bank raises its policy interest rate, the real interest rate rises, and consumption and investment decrease. As a result, the inflation rate gradually declines.

Thus, to understand the effects of monetary policy, it is necessary to take into account changes over time and the behavior of other economic agents. I am fascinated by how viewing the economy as a whole system allows us to understand that unexpected mechanisms are at work, and I am passionate about exploring them.

While it is of course important to explain things simply, on the other hand, behind phenomena that appear simple at first glance, there are actually many complex, intertwined factors.

Let's consider monetary policy as an example. The relationship where the nominal interest rate rises when the inflation rate goes up is intuitively easy to grasp. However, when you consider that central banks raise nominal interest rates to curb the inflation rate, this can seem contradictory at first.

In reality, in the short term, the inflation rate does not change immediately because firms cannot easily change their prices. Therefore, when a central bank raises its policy interest rate, the real interest rate rises, and consumption and investment decrease. As a result, the inflation rate gradually declines.

Thus, to understand the effects of monetary policy, it is necessary to take into account changes over time and the behavior of other economic agents. I am fascinated by how viewing the economy as a whole system allows us to understand that unexpected mechanisms are at work, and I am passionate about exploring them.

I believe that thinking broadly about a wide range of things is similar to digging deeply into one single thing. It feels like you can discover some kind of common mechanism and come to understand the phenomenon. On the other hand, you also realize that behind that mechanism, various events are intricately intertwined and cannot be easily explained.

I am always faced with the fact that while I try to explain things clearly, the background is extremely complex and cannot be easily explained. It may seem contradictory, but I believe this is where the true pleasure of research lies.