18. Election Under Inflation: LDP’s Choice of Macroeconomic Policy

The chapter delves into the economic conditions leading up to Japan's 2024 Lower House election, highlighting the shift from deflation to inflation and its impact on voters. It examines the macroeconomic policy stances of the LDP presidential candidates, focusing on the economic policy trilemma of fiscal discipline, distribution, and supply-side growth. The analysis reveals how Prime Minister Ishiba Shigeru's adherence to fiscal discipline narrowed the LDP's policy space, leading to significant electoral losses. The chapter also explores the strategies of opposition parties, such as the DPP and Reiwa, which emphasized distributional policies and gained electoral ground. Additionally, it discusses the economic policies of the Kishida administration and the BOJ's historic policy shift in response to sustained inflation. The conclusion underscores the electoral consequences of the LDP's policy choices and the ongoing challenges posed by inflation and the weakening yen.