Japan As A Model Industrialize Essay Research

Japan As A Model Industrialize Essay, Research Paper

With the Japanese economy being viewed as one of the most prominent, industrialized economies in the world, it is vital that one considers all of the requirements of a highly industrialized society, and not base their judgments solely on economic output. Through an analysis of Japan s reliance on her government to regulate her economy, it will be established that she cannot compete in the global market. Furthermore, it will be demonstrated that according to Alexander Gerschenkron s theory alluding to industrialization, Japan has not developed in a manner that will allow her to prosper. Lastly, the fact that Japan depends on technological borrowing supports Gerschenkron s theory for late industrializers. When examining all of these aspects as a whole, it is obvious that when referring to Alexander Gerschenkron s theory regarding industrialization, Japan cannot be classified as a model industrialized nation, as she possesses the characteristics of a late industrializer with a weak economic capacity.

Japan s reliance on her government to regulate both trading practices and business operations reflects unfair protectionism and her inability to compete in the global market. This will be validated through an analysis of the role of the Ministry of International Trade and Industry (MITI) within Japan s economy. Furthermore, an elucidation of a U.S based manufacturer s experience in doing business in Japan will reflect protectionism within the nation. Finally, a case study on the automobile industry in Japan will be analyzed, and will portray Japan s reliance on her government. When combined this evidence will exemplify the fact that Japan is unable to compete without the influence of her government and therefore cannot be considered an economic power or an industrialized model.

The most prominent government influence in Japan is the Ministry of International Trade and Industry (MITI), which controls a great deal of her economy; The formation of the Ministry of International Trade and Industry (MITI) in 1947 which decides strategic industrial policy and determines with the corporations, which industries to target, enter, exit and take over is the reason that Japanese corporations will enter a particular market together. (Leclerc, 1997:17) The previous excerpt implies that the corporations within Japan are able to organize themselves as one super-power, with the assistance of the government, and thus they are able to take over and force many foreign companies into bankruptcy. Consequently, one is forced to believe that Japanese economy would not be as successful, if the government did not assist it.

To further verify Japan s reliance on her government, an experience that a U.S lamp manufacturer Lite Lamp encountered while trying to do business in Japan will be described. In 1993 the U.S lamp manufacturer Lite Lamp attempted to import and distribute its lamps in Japan. During the initial paperwork the owner was told that his business would not be allowed to operate in Japan, as she does not allow any business to be one hundred percent (100%) foreign owned. After careful investigation the owner pointed out that his wife was of Japanese descent and thus he was entitled to have his business operate in Japan. After finding several buyers, Lite Lamps began to import its lamps, coincidentally the government operated inspection committee took over nine months to inspect the crate of lamps forcing Lite Lamps to lose its customers and leave the Japanese market. (Leclerc, 1997:7) This situation implies that the Japanese are afraid of American; or any other foreign competition, as they (Japanese) prevented Lite Lamps from entering their market. This ultimately reflects Japan s insecurity as a nation and her inability to compete in the global economy without the leadership of her government.

Furthermore, Japan s automobile industry has avoided foreign competition due to several government initiated protection laws. In 1995 the Japanese government created a protection law, that required all imported automobiles to be safety tested. This requirement may appear to be reasonable, however it should be noted that the government charged the importer over $1,000 per automobile to complete the inspection, and the process took in excess of two months. As a result of the increased importation costs the non-Japanese manufacturers were forced to raise the prices of their cars to maintain a reasonable profit, thus making their automobiles more expensive than the Japanese ones. Furthermore, the Japanese government forced automobile insurance companies to charge higher premiums for non-Japanese automobiles, making non-Japanese automobiles unattractive to the consumer. (Nokeed, 1996:156) This case study once again implies that Japanese corporations are inferior to foreign specifically American corporations, and as a result they rely on their government to protect and isolate their economy from global competition. This situation also creates a vast inconsistency, as foreign countries allow Japanese corporations to access their markets without excessive tariffs or restrictions. Thus implying that Japanese corporations are not as powerful or as competitive as they appear to be.

When examining all of the previous material that pertains to the Japanese government s involvement in her economy it is very obvious that she relies