Did the Plaza Accord cause Japan's real estate bubble?

Abstract In 1985 the international exchange rate intervention known as the “Plaza Accord” was carried out between the G‐5 countries, the US, Japan, Germany, France, and the UK. In this study I employ the synthetic control method to examine if there was a causal effect of the Plaza Accord on residential housing prices in Japan. Following the agreement Japan experienced a bubble in urban real estate and the stock market. I find small and insignificant effects of the Plaza Accord on real housing prices in the several years following it, providing evidence that the Accord did not exacerbate the bubble.