A Critical View of Japan as an Economic Power
It is common knowledge that the Japanese economy has been a target of criticism from the United States and the European Community due to its performance over the last twenty years. This blames Japan for everything from huge surpluses in current accounts, floods of Japanese cars and electronics sweeping over the American and European markets, down to administrative restrictions on the access of foreign enterprise to the Japanese home market. The clearest response to these accusations came in the “Maekawa Report,” drafted by a committee chaired by the late H. Maekawa, former Governor of the Bank of Japan, at the request of the then Premier Yasuhiro Nakasone. This report may be summarized in the following points: The huge surpluses in current balances result from an industrial structure which stresses export promotion. Japan should make every effort not only to cooperate in the international economy, but also to stimulate domestic demand for economic growth, especially by expanding personal consumption and by improving the quality of domestic life. Concrete measures to attain these goals consist of the relaxation of government regulations on economic activities, the abrogation of a tax reducing system to encourage domestic savings, the reduction of income taxes to promote domestic consumption, the curtailment of working hours to increase leisure time and the liberalization of the agricultural market to increase imports. The Maekawa Report was warmly received by the United States and the European Community.
KeywordsReal Estate Trade Balance Domestic Saving Japanese Economy Convertible Bond
Unable to display preview. Download preview PDF.