Abstract
The relative positions of Japanese manufacturers in their domestic market vary per product, ranking and pecking order — defined as share in the Japanese market and the ability to eliminate the undercutting of prices by local or foreign competitors. But in the area of electrical consumer appliances, relative positions are more or less proportional to the number of shops a manufacturer has in his control, or which belong to his trade keiretsu: Matsushita has 25%, Toshiba 15%, and Hitachi 10%. With a 15% share in colour television, Sharp’s position is higher than its expected ranking order, mainly because of its activity and strength in Liquid Crystal Displays (LCDs) — resulting from its activity in the calculator business — and, hence, in small and very small screen television. The export position in Japan is proportional to market share, with Matsushita being at the top with the greatest number of tied distributors and retail shops in its keiretsu — and being the greatest exporter.
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Notes Chapter XII
The anti-dumping data are derived from various United States International Trade Committee publications. The table contains rounded off percentages.
Regulation EEC No 112/90, L13/33.
Vermulst and Waer (1991), p. 37.
According to the GfK data on 1986 and a part of 1987, all Japanese brands showed considerable gain in market share. Their increase in market share in response to price decreases was considerable. Source: COMPACT, Injury Report, in which a chapter about price elasticities
At least in the cases of typewriters, printers, plain photo copiers, Compact Disc players the Official Journals mentioned sales to original equipment manufacturers.
In American anti-dumping law and practice, dumping is considered to have taken place if there is any price discrimination, apart from the question whether and to what extent price-undercutting has taken place on the American market. The only relevant questions are whether dumping has taken place and whether injury has been inflicted. This definition deviates from the one used by the European Community: export prices (P,) are below those normally incurred on the export market, P„ whatever may be the costs that have to be included in this latter price. The difference in the calculation of P e and P, is one of the major issues in the debate between defenders of Japan and the European Commission. See also Vermulst (1987), p. 688.
The Financial Times, July 17, 1991, described a Japanese report on the anti-dumping procedures of the EEC and the United States which are alleged to be unfair.
The Economist, June 15, 1991.
The definition of the dumping percentage needs to be repeated here. The normal value is the domestic value - that is factory costs plus general, selling and administrative costs plus a profit mark-up. The dumping percentage is the normal value minus the export price on a free-on-board (FOB) basis, divided by the export price on the basis of cost, insurance, and freight (CIF). A percentage of more than 100% is, sequentially, not absurdly high.
Krishna (1989), pp. 80–89.
Commission of the European Communities, Directorate-General Internal Market and Industrial Affairs (January 1990), p. 3.
As seems to be suggested in Prestowitz (1988), especially pp. 125–150.
On the test of market returns, the targeting of steel does not look at all like a good idea… Only if social rates of return were much higher than private rates can the policy be justified.“ ”Heresy though it may seem, it is hard to avoid the conclusion that the most famous of industrial policy successes was no success at all. It encouraged Japanese industry to invest in an activity with low returns and generated no visible side benefits.“ Krugman (1987), pp. 266–296, pp. 287–288.
Krugman (1987), pp. 266–296, p. 267.
Krugman (1987), pp. 273–274.
Porter (1990), p. 4, Johnson (1982); Van Wolferen (1985).
The famous example of a general tax and a subsidy to apple growers quoted by Bhagwati (1968), pp 1–69 (Frank Graham Lecture, 1967), pp. 19–29. Apple growers offer their apple blossoms free to bees so that apiarists can make money out of honey. A subsidy to apple growers will improve the position of the whole economy. The example has been given by James Meade.
Kreinin (1987), p. 313.
Nester (1991), p. 172.
The Economist April 15, 1989: “Japan’s technology gap”.
Brander (1986), p 37.
Protectionist measures“ belongs to a terminology which deals more with the intentions of the measures than with the nature of the measures themselves. Protective measures can be measures which fit into a protectionist policy, which is the result of a protectionist mind. Protective measures are not necessarily caused by protectionism.
Rapoport and Chammah (1963).
Prestowitz (1988), p. 259.
Maswood (1989), p. 21.
A striking example is the occasion when the EEC increased the duty on Video Cassette Recorders from 8% to 14%. According to Article XXVIII of GATT such a deconsolidation is only permitted provided that adequate compensation is given. As compensation, the EEC offered reductions of tariffs on portable radios, cassette players and some other items. One important product was accidentally included in the compensation: portable radio recorders, the ghetto-blasters. The Community wanted to withdraw the reduction on this tariff heading. When the Japanese were able to exchange this re-imposition of the tariff for the maintenance of their highly illegal, secret quantitative restrictions on shoes, about which there was a conflict with the Community, MITI felt relieved.
Helou (1991), p. 122.
The result of the negotiations depends on the ability of players to harm the other player, their ‘threat points’. The player who has more threat points will receive more from the game. The outcome for each of the players is highly uncertain. Some authors have tried to find mathematical solutions based on assumptions of the way in which co-operative and competitive elements should be separated and weighed and the utilities (or evaluation of outcomes by players) should be distributed. The outcome has been the subject of an interesting, but undecided, academic debate. Braithwaite (1963), Luce and Raiffa (1957), and Nash, (1950) have totally different outcomes of the same negotiable game, the Battle of the Sexes, for which they have calculated ’fair solutions’.
The Economist: “Deaf Japan against blind America”, May 18, 1991.
Structural Adjustment and Economic Performance“, OECD, (1987). ”Japan has been more successful than any other country in achieving the right mix of technological and organizational innovation.“ It is a mix of competition and co-operation.
Hagiwara, Noguchi and Masui (1988), p. 46. As the conclusion of two anti-dumping cases against Korea and Pakistan, the two countries agreed on voluntary restraints.
Porter (1990), p 771.
Proposals have been made by Van Wolferen, K: “The Japan Problem”, Foreign Affairs, and Prestowitz.
Kostecki (1991), pp. 92–93.
Preusse (1991), p. 7.
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© 1993 Physica-Verlag Heidelberg
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van Marion, M.F. (1993). An Isolated Cartel Economy in World Trade. In: van Marion, M.F. (eds) Liberal Trade and Japan. Contributions to Economics. Physica-Verlag HD. https://doi.org/10.1007/978-3-642-46942-8_13
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