The government bureaucracy has been instrumental in the industrial growth of Japan since the beginning of the Meiji Restoration in 1868. But the economic initiative was always on the part of the private sector. Especially, the business role in R+D finance is worth mentioning (70 per cent of the total value of investments). First of all, the technological edge is kept by keiretsu firms and their subsidiaries, as well as subcontractors. Three reasons seem to be crucial: 1) growth-orientation in a firm, 2) a good knowledge of production, research and marketing by the Japanese managers, 3) decentralized information plus centralized personnel policy (DI CP). The macroeconomic factors considered in this paper include: 1) the correct level of foreign exchange rate, 2) the relative prices of capital goods, 3) a low interest rate, 4) taxes on a functional basis. Also the importance of economic visions is perceived. And in conclusion, the excellent educational standards of the Japanese society and its high saving-propensity are discussed.
Traditionally, the state bureaucracy in Japan has been enjoying great prestige although remunerations earned by that group are not among the highest. The high social position results from the role played by the state administration (together with the private sector) in overcoming Japan's economic backwardness and in making it the second superpower in the world. The question is what are the sources of the longstanding cooperation between the government and business. Undoubtedly, one of them is the practice of amakudari - the retiring bureaucrats assume lucrative positions in the industry, on the whole in this industry which they supervised during their active professional life. The essential roots of this cooperation date back to the period of accelerated economic growth in 1954-1971 and they lie in the positive attitude taken by the government and by MITI in particular to the institution of price-production cartel. Organized in exporting industries, this cartel has contributed to a real expansion of Japanese products in the world (often at dumping prices). In spite of the fact that the international situation has changed radically, MITI continues to represent the acquiescent attitude to the institution of cartel, which implies harmful consequences, both economic and political.
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