Japan's Bubble Economy Japan's economy has experienced tremendous growth since the end of the Korean War. GNP growth in 1967 and 1968 was over 10% (double-digit growth period), which exceeds that of countries such as Britain, France and Germany. The economy boomed due to many reasons, such as: expansion of industrial facilities, massive adaptation of Western technology and education, reduction of military spending to 1% of GNP, relationship with national power, human resources and their spirit to achieve the "zero defect program". ". But after the first and second oil shocks which occurred from 1973. The economy declined partly due to the mismanagement of economic policy. Although the government tried to adjust its economic policy, the recovery has been slow. As the rise of the yen continues, export demand has increased significantly. Recognizing the United States' concerns about this problem, President Reagan and the G5 signed an agreement with Japan called ". Plaza Agreement", this agreement stipulating that the exchange rate of Japan and the German mark can appreciate against the United States. Since the value of the yen began to appreciate, Japan was going through a period of adjustment of its trade balance As Japan prepares to go through a period of adjustment of its trade balance, it will also experience a period of recession The government therefore strongly encourages trade activities to strengthen the economy in order to avoid. backlash effects. It was this event that caused the GNP and the exchange rate to increase. This exchange rate advantage stimulated commercial activity in housing and stock market investments, which created an economic bubble. During this period, almost the entire country was involved in land speculation or other speculative activities. This essay will prove that land speculative activities have had many negative impacts on Japanese society and economy. First, it will describe the cause of land speculation. Secondly, it will discuss the social and political effects in Japan and finally it will focus on the economic effects, in addition to including the consequences of the collapse of the bubble. The root of this bubble economy is due to the wave of land speculation. The generalization of land speculation activities is mainly explained by the fact that they are profitable. Speculative trading in assets has increased and many believe this will last for a very long time. One of the reasons that leads to massive investments in risky activities is the success of the Japanese in the international market during the 1970s and 1980s. Many Japanese companies and