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Japan and the world economy
Japan
and the World
Economy
1 (1988) 1-2. North-Holland
Editorial Introduction JAPAN AND THE WORLD
ECONOMY
Rising from the devastation of World War II, Japan became the first East Asian economy to achieve prominence among industrial nations; and today, she is the only member of the G-7 that is not from the Atlantic basin. Universally, her phenomenal growth is perceived to have been achieved through a judicious combination of Eastern and Western institutions and values. Throughout this period, Japan remained a democratic polity committed to the free market system. An island nation, like Great Britain, she produced for the world market. But yet she has been criticized repeatedly for restricting foreign access to home markets and recently faced political pressure to liberalize her import policy. Japanese companies have earned international reputations for producing quality products at very competitive prices, and they are known for their ability to adopt new technologies for commercial production. However, these same companies face criticism for their neglect of basic research. International debate on Japanese industrial policy has focused on the extent to which various companies have deferred their individuality in order to pursue the cooperative policy as outlined by MITI. While some claim that this industrial policy made a major contribution to the economic resurgence. others argue that it succeeded only where public policy and private interest coincided. Japanese companies have claimed success in achieving productivity and cost control without alienating their employees as the tradition of lifetime employment has permitted them to adopt a very humanitarian policy towards their workers. Now other nations are trying to adopt the Japanese management style. The conventional wisdom in economic circles during the post-war years has been that economic reconstruction and development cannot be financed through voluntary savings and that either massive external assistance or forced savings are needed. The excesses of a Stalinist policy may be infeasible in a non-totalitarian society, but moderate amounts of forced savings through taxation, inflation, and other forms of compulsory reduction in consumers’ purchasing power are considered unavoidable. In contrast, the Japanese economy has maintained one of the highest savings rates in the world. She has now become a major exporter of capital; her banks and security firms are among the leaders of the world financial markets; and recently economists and politicians have been advising Japan to cut its savings rate. 0922-1425/88/$3.50
0 1988, Elsevier Science Publishers
B.V. (North-Holland)
z
Editonal tntroductton
When a new economy with its own institutions and traditions rises to prominence, a debate is frequently sparked concerning the source of its success. If the ensuing discussions are to be productive, they should separate the enduring from the ephemeral characteristics of the economic transition and should identify those which are universally adoptable from those which are not. The purpose of this Journal is to encourage an objective and scientific analysis of the interaction between Japan and the world economy. Scholarly papers in economics, finance, international trade theory and practice, management and organizational behavior, marketing, operations research and quality control that analyze the characteristics of this emerging international economy will be published. Theoretical papers will be welcome if they shed light on policy issues. The Journal will also give representation to the views of policy makers through occasional publication of their interpretations of various events. I am delighted that a number of distinguished scholars have shown interest and commitment by joining our editorial board, and I am being assisted by four competent and enthusiastic associate editors. However, the success of the Journal will ultimately depend upon your support as a reader and a contributor.
Ryuzo Sato Editor
and the World
Economy
1 (1988) 1-2. North-Holland
Editorial Introduction JAPAN AND THE WORLD
ECONOMY
Rising from the devastation of World War II, Japan became the first East Asian economy to achieve prominence among industrial nations; and today, she is the only member of the G-7 that is not from the Atlantic basin. Universally, her phenomenal growth is perceived to have been achieved through a judicious combination of Eastern and Western institutions and values. Throughout this period, Japan remained a democratic polity committed to the free market system. An island nation, like Great Britain, she produced for the world market. But yet she has been criticized repeatedly for restricting foreign access to home markets and recently faced political pressure to liberalize her import policy. Japanese companies have earned international reputations for producing quality products at very competitive prices, and they are known for their ability to adopt new technologies for commercial production. However, these same companies face criticism for their neglect of basic research. International debate on Japanese industrial policy has focused on the extent to which various companies have deferred their individuality in order to pursue the cooperative policy as outlined by MITI. While some claim that this industrial policy made a major contribution to the economic resurgence. others argue that it succeeded only where public policy and private interest coincided. Japanese companies have claimed success in achieving productivity and cost control without alienating their employees as the tradition of lifetime employment has permitted them to adopt a very humanitarian policy towards their workers. Now other nations are trying to adopt the Japanese management style. The conventional wisdom in economic circles during the post-war years has been that economic reconstruction and development cannot be financed through voluntary savings and that either massive external assistance or forced savings are needed. The excesses of a Stalinist policy may be infeasible in a non-totalitarian society, but moderate amounts of forced savings through taxation, inflation, and other forms of compulsory reduction in consumers’ purchasing power are considered unavoidable. In contrast, the Japanese economy has maintained one of the highest savings rates in the world. She has now become a major exporter of capital; her banks and security firms are among the leaders of the world financial markets; and recently economists and politicians have been advising Japan to cut its savings rate. 0922-1425/88/$3.50
0 1988, Elsevier Science Publishers
B.V. (North-Holland)
z
Editonal tntroductton
When a new economy with its own institutions and traditions rises to prominence, a debate is frequently sparked concerning the source of its success. If the ensuing discussions are to be productive, they should separate the enduring from the ephemeral characteristics of the economic transition and should identify those which are universally adoptable from those which are not. The purpose of this Journal is to encourage an objective and scientific analysis of the interaction between Japan and the world economy. Scholarly papers in economics, finance, international trade theory and practice, management and organizational behavior, marketing, operations research and quality control that analyze the characteristics of this emerging international economy will be published. Theoretical papers will be welcome if they shed light on policy issues. The Journal will also give representation to the views of policy makers through occasional publication of their interpretations of various events. I am delighted that a number of distinguished scholars have shown interest and commitment by joining our editorial board, and I am being assisted by four competent and enthusiastic associate editors. However, the success of the Journal will ultimately depend upon your support as a reader and a contributor.
Ryuzo Sato Editor