Japan's High Technology Industries: Lessons and Limitations of Industrial Policy

By Larry Meissner; Hugh Patrick | Go to book overview

Chapter 4

Japan's Industrial Policy
for High Technology Industry

Ken-ichi Imai

Japanese industrial policy has in the past supported market-based developments in fields where success was obvious. That is not being cynical; it was a coherent, substantive policy. As to form, MITI's offical position is that "Premised upon indirect and guideline policies, Japanese industrial policy is much more soft-handed than industrial policy activities in the other industrialized democracies" (Yamanaka 1983). The key word is "soft-handed." What some of the specific policies have been for high technology industries, and an assessment of the role of industrial policy in high technology development, are the principal topics of this essay. My particular concern is how relevant past policy is to the high tech future.

What kind of government policies are effective, indeed, possible, is influenced by management style and industrial organization, and Japan and the United States have some important differences in this regard. Understanding these differences is necessary for understanding what Japanese industrial policy is and how it works. This is taken up in the first section. I then look at policies for the microelectronics, energy, and biotechnology industries, discuss technology transfer and the related "technopolis plan," and, lastly, consider the communications industry, which has been dubbed the "new media" and is MITI's current policy focal point.

Continuous, cumulative development accounts for most technological advances, and this is as true in today's seemingly fast-changing world as it was in the mid-1950s when Gunnar Myrdal talked of "cumulative causation" in industrial development (Myrdal 1957). A series of small or medium innovations collectively can produce (indeed, can be) a breakthrough. The system's learning process is what effectively builds these cumulative developments, from innovation to creation, from basics to

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