What next in Japan after a stunning electoral defeat for the country's long-serving ruling party?

Live from the BBC World Service.

This is the Marketplace Morning Report.

Will Bain with you again today. Thanks for being with us.

Yes, the world's fourth largest economy wakes up this morning to plenty of political uncertainty

after the ruling coalition, led by the Liberal Democratic Party, fed far worse in this weekend's national elections than many had expected.

The BBC's Steve Lye is in Tokyo. So what factors led to the result?

Yeah, so the two big things. One is the string of scandals related to funding for political parties that his party had been embroiled in

for months and months leading up to the elections. In fact, he only came to power as a result of

the previous Prime Minister of Fuma Okishita stepping down over these scandals. So he was sort of put in

place to try and improve the image of the party and trying to go into this election and come out

with a strong

mandate. That whole decision process has really backfired on him. And the second thing is with the

economy, people in Japan have been feeling the pinch with wages that hadn't risen for three

decades and the country had moved from deflation into inflation in the last year, meaning that

goods and services had just become more and more

expensive in Japan, and they didn't have wages that were keeping up. So Japanese people were

being felt poorer, and at the same time, you know, the leading party was having all these

scandals where prominent politicians were revealed to be taking kickbacks and receiving funds,

and it all just left such a bad taste in their mouths that they've taken

it to the ballot box to show how they feel.

And that political uncertainty gets souped up again and causes even more potentially

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