Japanese Economic Policy Reconsidered

Japanese Economic Policy Reconsidered provides a critical evaluation of the key issues facing the Japanese economy, and the political and economic environments that continue to hold back Japan’s future growth. The contributors advocate far-reaching structural reform in order to allow market forces to dictate industry policy. They then turn to the changing role of foreign trade and evaluate the Clinton Administration’s attempt to define a new approach to US–Japan trade relations. Special attention is given to an empirical analysis of the problem of overseas production. They also examine the peculiar characteristics of Japanese foreign direct investment inflows, and advocate the removal of disincentives to foreign investment, in order to encourage trade and economic growth. The authors then discuss the role of the financial sector, particularly in relation to Germany and the United States, and discover parallels in monetary policy in all three countries. They recommend regulatory reform of the financial sector in Japan to adapt to the future financial environment.