Japanese Economic Policies and Growth: Implications for Businesses in Canada and North America

By Masao Nakamura; Iian Vertinsky | Go to book overview

6
The Determinants of Japan's Competitive Position Implications for Canada

Introduction

The fundamental factors that explain Japan's economic growth, provide comparisons to the performance of other industrial countries and attempt to distill some lessons from Japan's experience and phenomenal economic success must be examined. Since the data base of this study is limited and the number of confounding variables large, this analysis cannot serve to properly test the validity of alternative economic growth models. Indeed, alternative models were used to provide a normative basis for interpreting the association identified between policies, actions, institutional arrangements and socio-economic conditions and performance. This exercise can also serve to indicate whether the predictions of some growth models are less universal than their proponents claim (e.g., finding examples where policies that do not correspond to those derived from the models have been, nevertheless, successful). Clearly, any study based only on associations between variables cannot avoid the danger of interpreting spurious correlations as causal relationships.

International comparisons to assess the role of government in Japan and its success in providing a stable macro-economic policy environment that enhances competitiveness were used in this analysis. The role of government in intervening to correct market failures is then examined. Considered next is Japan's experience in adopting "industrial policies" i.e., the attempt

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