Competing Capitalisms: Theoretical and Policy Implications

Abstract

One of the most striking and intriguing differences that emerges from a comparative analysis of Japan and Australia is not simply the different policy approaches that have been taken by the politi-cal and business elites of each country, but also the impact such policies appear to have had on the structure of domestic economic activity. Japan has, or more accurately Japanese-based companies have, become synonymous with the production of goods which define the international benchmarks for quality, technological sophistica-tion and — perhaps most importantly — intrinsic wealth-generating potential. Japan’s ever-expanding, politically embarrassing, trade surpluses are testimony to the efficacy of such strategies. Economic activity in Australia, by contrast, remains centred on low-value-added commodities that are vulnerable to dramatic externally determined shifts in its terms of trade. More importantly from the perspective of long-term development and social cohesion, this sort of com-paratively unsophisticated economic activity does not generate the sorts of highly paid jobs that underpin national living standards. In short, as Stephen Bell (1997: 2) puts it, Australia has ‘the wrong type of economy for the late twentieth century’.