, such changes in inflation expectations are contained by the central bank's commitment to aggressive tightening to control inflation. indeed, since the 1980s, many countries have developed monetary policy frameworks with a view to stabilizing inflation expectations. inflation targeting, of course, is a typical example. however, there are many issues that need to be better understood regarding inflation expectations. for example, market participants, firms, and households all have different expectations formation, given different perceptions of current inflation. in addition, these expectations are susceptible to the influence of their experience or psychological conditions, as well as to the central bank's communication. moreover, there is no guarantee that the way they are formed will remain stable over time. there is still much room for further research in this area, including in relation to central bank communication. new challenges next, i would like to mention two new challenges. the first is about the changing inflation and economic environment. from a long - term perspective, many countries, 2 / 4 bis - central bankers'speeches including japan, typically went through a period of great inflation and the subsequent great moderation, followed by the global financial crisis, and then faced a period of " low for long " before the pandemic. there is a view that the current ongoing global inflationary pressure will eventually subside and that a period of " low for long " will resume. on the other hand, there is also a view that the current period of high inflation will change people's views on prices, leading to a departure from " low for long. " we have seen higher levels of public and private debt as a result of the pandemic and the policy responses. in addition, people have once again been concerned about geopolitical risks since 2022, leading to a partial reversal of globalization. therefore, it may be difficult to deny the possibility that we are already in a new normal that is different from the period of " low for long. " the second challenge is about the changes in central banks themselves. in the period of " low for long, " many central banks faced the effective lower bound of policy rates, which is the traditional policy instrument, and have created various unconventional policy toolkits, including large - scale asset purchases and forward guidance. while a number of empirical studies support some effectiveness of these instruments in stimulating demand, it seems that the mechanisms at play are not fully understood even today. compared to conventional instruments, which have a long history, unconventional instruments have issues such

united states ( chart 15 ). to address this situation, the government has announced plans to lay the groundwork for the creation and growth of startups, such as streamlining the initial public offering ( ipo ) process and exploring a framework for special purpose acquisition companies ( spacs ) from the perspective of investor protection. i expect such efforts, coupled with an inflow of venture capital, to support startup growth. at the same time, i look for more active m & a activities to help integrate ventures with their best owners, and for entrepreneurs to keep trying to start new businesses and drive growth. my strong hope is that these developments will revive the dynamism of japanese firms and generate a wealth of innovation, thereby allowing japan to soon realize new growth. b. reinforcing investment in human capital another key to innovation, alongside corporate dynamism, is human capital. under japan's long - term employment practices, marked by seniority - based wages and internal promotions, both management and employees prioritized achieving greater production efficiency, and there was a strong tendency for them to emphasize gaining experience through business activities and on - the - job training. in an era where boosting the efficiency of existing business operations was the driving force behind growth, i think that venture enterprise center, venture white paper 2021, december 2021 ( available only in japanese ). survey by cb insights ( as of december 31, 2021 ). japanese - style human resource ( hr ) development functioned effectively. in the current vuca era, however, it is no longer possible to achieve sustainable growth simply by boosting the efficiency of existing business operations. also, on - the - job training alone, being an extension of existing business operations, is not adequate to the discontinuous nature of innovation. investment in human capital is vital for acquiring new ideas and capabilities. such investment has been muted in japan, however, being typically treated as a " cost " in corporate accounting. we see the difference, for example, in the ratio of japanese firms'vocational training costs to gdp, which is low relative to other advanced economies ( chart 16 ). meanwhile, the average amount of money spent by firms per employee on offthe - job training and self - development support is also on the wane ( chart 17 ). to encourage firms to invest in human capital, japan's prime minister announced in a policy speech in january that the government would formulate rules for corporate disclosure of nonfinancial information, including investment