The latest IGM forum poll of economic experts asks, in effect, whether Japan was in a liquidity trap. The statement given is

The persistent deflation in Japan since 1997 could have been avoided had the Bank of Japan followed different monetary policies.

The page does not load properly for me, due to a JavaScript error. But only Bob Hall disagrees, offering a liquidity trap argument. Apparently, none of the other economists polled is willing to argue for the liquidity trap.

Of course, I do not believe in the liquidity trap. Just watch. In the case of Japan, the central bank could have printed yen to buy dollars and other foreign currency, and I am confident that by doing so they could have produced inflation.

Thanks to Mark Thoma for the pointer.