Transition to Post-WW II Era

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Transition to Post-WW II Era Defeat by Allied Forces in WWII, 1945 End Japanese colonial rule Taiwan— to Republic of China Korea—independent Break up zaibatsu keiretsu

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Transition to Post-WW II Era. Defeat by Allied Forces in WWII, 1945 End Japanese colonial rule Taiwan— to Republic of China Korea—independent Break up zaibatsu  keiretsu. Transition to Post-WW II Era. US Occupation of Japan US seeks to break up zaibatsu Firms continue on as k eiretsu - PowerPoint PPT Presentation

Transcript of Transition to Post-WW II Era

Page 1: Transition to Post-WW II Era

Transition to Post-WW II Era

Defeat by Allied Forces in WWII, 1945 End Japanese colonial

rule Taiwan— to Republic of

China Korea—independent

Break up zaibatsu keiretsu

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Transition to Post-WW II Era

US Occupation of Japan US seeks to break up

zaibatsu Firms continue on as

keiretsu Example: Mitsubishi

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Nature of Japanese System, Post-WW II: Johnson reading

What are the elements of the capitalist developmental state model, according to Johnson?

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Nature of Japanese System, Post-WW II: Johnson reading

What are the elements of the capitalist developmental state model, according to Johnson? Bureaucrats are elite

“Best and brightest” Very competitive civil service exams

Tokyo University (established 1877) Educate civil servants

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Nature of Japanese System, Post-WW II: Johnson reading

What are the elements of the capitalist developmental state model, according to Johnson? Bureaucracy has authority

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Nature of Japanese System, Post-WW II: Johnson reading

What are the elements of the capitalist developmental state model, according to Johnson? State policy is market-conforming

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Nature of Japanese System, Post-WW II: Johnson reading

What are the elements of the capitalist developmental state model, according to Johnson? Exemplified by MITI

Ministry of International Trade and Industry In 2001, MITI became METI

Ministry of Economy, Trade, and Industry

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Nature of Japanese Economic System, Post-WW II

Central role of economic bureaucracy Industrial policy

Sector specificPromote increasing sophistication

Textiles, consumer goods Steel, machinery

Automobiles High-tech

Semi-conductors Robotics

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Nature of Japanese Economic System, Post-WW II

Central role of economic bureaucracy“Administrative guidance” “Mercantilism”

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Nature of Japanese Economic System, Post-WW II

World’s 3rd largest economy Economy is highly efficient and

competitive in areas linked to international trade, but productivity is far lower in protected areas such as agriculture, distribution, and services

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Review: Nature of Japanese System, Post-WW II

What are the elements of the capitalist developmental state model, according to Johnson? Bureaucrats are elite

Well paid, recruited through merit, w/relevant skillsBureaucracy has authorityState policy is market-conformingExemplified by MITI

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Nature of Japanese Economic System, Post-WW II

Close ties between government and keiretsu “amakudari” (descent from heaven)

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Nature of Japanese Economic System, Post-WW II

Close ties between government and keiretsu “Iron triangle”

What are the three parts of the “iron triangle”?

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Nature of Japanese Economic System, Post-WW II

Close ties between government and keiretsu “ “iron triangle”

business interests

/ \bureaucrats __ politicians

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Recent Sources of Economic Stagnation in Japan “Close ties between economic

bureaucracy and corporations (including banks) under their regulatory jurisdiction…has contributed to Japan’s problems.”

Source: Daniel Okimoto, Stanford

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Japan: Abe on the Brink “Suicide of one minister under

a cloud of corruption (Agriculture Minister Toshikatsu Matsuoka)

By July 8 even one of Abe's substitute ministers—Agriculture Minister Norihiko Akagi, named to replace the late Matsuoka—was mired in a fresh campaign-funding scandal.

A recent survey by the YOMIURI SHIMBUN newspaper pegged Abe's approval rating at an anemic 32%

Abe's Agriculture Minister Matsuoka, under fire for accepting questionable political donations, died on May 28 at a Tokyo hospital after reportedly hanging himself

Thursday, Jul. 12, 2007 TIME

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Japan's Abe takes one for the team Abe announced his resignation

on Wednesday afternoon in Tokyo.

While he [had] pledged to refocus in his new administration, the daily drip of scandals that forced the resignation of cabinet ministers and other party officials quickly ended any hopes for a fresh start.

(There are now reports that Abe himself is involved in financial wrongdoing.)

Sep 14, 2007

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Japan in the 21st Century

Which theory best explains Japan’s economic stagnation 1990-2010?

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Nature of Japanese Economic System, Post-WW II

Weak position of organized laborCompany-based unions

Loyal to company not union Ties to national federation of labor weak

Compare British and Japan as of 1980 60% of workers in Britain unionized 30% of workers in Japan unionized

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Nature of Japanese Economic System, Post-WW II

Small welfare state Social protectionCompare British and Japan as of 1990

25% of GDP spent on welfare in Britain 10% of GDP spent on welfare in Japan

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Nature of Japanese Economic System, Post-WW II

“Dual economy” of large and small firmsSmall, “satellite” firms

Employment Women Temporary