1999 Reports

Japanese-style capitalism

Sato, Kazuo

Japanese-style capitalism is a collusive system of national politics, elite bureaucracy, and big business. Elaborated in the course of rapid growth, it served Japan's post-war economic growth in flying colors. But on-going structural changes, induced by growth slowdown and population aging, now places Japanese-style capitalism in jeopardy. In this paper, we review these changes in the near past -- changes in the microeconomic sphere such as the family system, the employment system and the business system and changes in the macroeconomic sphere such as increasing part-time work in the labor market, slowdown in technical change, decline in manufacturing at home, persistence of trade surplus, and ongoing financial deepening.