This paper studies the industrial policies which are pursued during the high growth period in Japan. The industrial policy in the high growth period was closely correlated with the movements of external economic liberalization.
Industrial policy of p...
This paper studies the industrial policies which are pursued during the high growth period in Japan. The industrial policy in the high growth period was closely correlated with the movements of external economic liberalization.
Industrial policy of pre-liberalization had the characteristics of protection and promotion of infant industries, which had a great contribution to the development of industrial structure. But this policy had raised industrial organizational problems and was reckoned to weaken external competitiveness through exceeding competition among firms.
Much concern had been given to the modification of industrial policy as a response to the implementation of trade and capital account liberalization not to lose external competitiveness. So the industrial policy afterwards was formed towards oligopolization of market structure and making largescale firms by way of merge and acquisition. This policy was regarded as a best way of maintaining external competitiveness.
But oligopolization policy brought about economic inefficiency and made Japanese economy more rigid. So this trend of industrial policy can not be lasted after the first oil shock.