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The nature and consequences of lawyers’market regulation in Japan

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  • T. Kinoshita

Abstract

In Japan, the lawyers’market is regulated so strictly that the contrast between the small lawyers’market and the huge economy is surprising. The number of lawyers is about 15,000, while the GDP and population are $4 trillion and 130 million, respectively. The regulation is governed principally by the Supreme Court of Japan and the Ministry of Justice. Regulations are implemented mainly through (1) strict bar examinations and (2) long trial times. The pass rates of the exam are 2–4% each year, and the average trial time (civil cases and District Courts) is 19.2 months. The consequences of the regulation are that (1) consumers pay 13.9‐100.0% higher prices than in countries with no regulation, and (2) the expected rate of return on human capital investment in lawyers is very low, around the 0% level. It is not only a great loss for Japanese economy but also very unfortunate for university students that the investment opportunity in this most respected profession is almost blocked.

Suggested Citation

  • T. Kinoshita, 2000. "The nature and consequences of lawyers’market regulation in Japan," Contemporary Economic Policy, Western Economic Association International, vol. 18(2), pages 181-193, April.
    • Handle: RePEc:bla:coecpo:v:18:y:2000:i:2:p:181-193
    DOI: 10.1111/j.1465-7287.2000.tb00016.x
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    References listed on IDEAS

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    1. Milton Friedman & Simon Kuznets, 1945. "Income from Independent Professional Practice," NBER Books, National Bureau of Economic Research, Inc, number frie54-1.
    2. Rosen, Sherwin, 1992. "The Market for Lawyers," Journal of Law and Economics, University of Chicago Press, vol. 35(2), pages 215-246, October.
    3. Milton Friedman & Simon Kuznets, 1954. "The Data on Income from Independent Professional Practice," NBER Chapters, in: Income from Independent Professional Practice, pages 46-62, National Bureau of Economic Research, Inc.
    4. Gary S. Becker, 1975. "Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education, Second Edition," NBER Books, National Bureau of Economic Research, Inc, number beck75-1.
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    1. Yamamura, Eiji, 2013. "Trial experience, satisfaction and incentive to bring another lawsuit: Does aspiration level influence winners and losers?," Japan and the World Economy, Elsevier, vol. 28(C), pages 125-131.
    2. Yamamura Eiji, 2008. "The Market for Lawyers and Social Capital: Are Informal Rules a Substitute for Formal Ones?," Review of Law & Economics, De Gruyter, vol. 4(1), pages 499-517, December.

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