As the last post commented on the world seems to be struggling, not just the United States. Japan seems to be hitting a wall as well. After thriving for the past few years, working its way up to having the number 2 ranked economy in the world, Japan's economic growth is slowing and some experts say that they will soon be passed. The article I read said Japan's gross domestic product grew at a rate of 1.3% in the third quarter. This is still an increase, but this rate is half that of the United States. Some fear the U.S. is next however, as the fiscal outlook for the next decade shows deficits averaging over $600 Billion. Also expecting the debt to be $6 trillion in 10 years. I think this is something we should be concerned about, but at the same time Japan may be just entering a recession while, as some economists say, the U.S. is showing signs that we are coming out of one. Though we may have some similarities with our debt and Japan's i think that the fact we are exiting a recession is key and that this will not effect our debt rating.
http://money.cnn.com/2010/01/26/news/international/japan_ratings/index.htm
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Japan's economy has been struggling for years, and the recession has only made things worse. Most Americans, i think, have been fooled by the success of Japanese automakers into thinking that the Japanese economy as a whole has been out-performing the U.S. The fact of the matter is that a number of of difficult problems with the Japanese "model" have left it at a relative disadvantage when compared with other developed nations. The Japanese style of promotion, which involves promoting employees based on seniority rather than performance, leaves Japanese businesses less innovative, run by long-time company insiders, without the fresh ideas that come with promoting high-performing, younger employees (or, perhaps, god forbid, company outsiders). Moreover, discrimination against Japanese women in Japanese business, manifested most clearly in the strong pressure exerted on Japanese women to quit their jobs and become housewives once they get pregnant, has left much of Japan's workforce either underemployed or unemployed altogether. This is particularly problematic because pressuring Japanese women to quit their jobs if they get pregnant has proved to be an incentive not to have children at all for many career-oriented Japanese women. This, in turn, has left Japan with an aging population; economically problematic as a continually smaller Japanese workforce has to support a continually larger group of Japanese retirees (especially considering Japan's tight limits on immigration). These are but a few of the problems Japan will need to deal with if it wants to maintain is relatively high level of prosperity (others include a overly large and influential bureaucracy, inadequate voice for shareholders in running Japanese business, and an inefficient an overly subsidized/protected agricultural sector). It was general acknowledgment that Japan needs to change that led Japanese voters to vote into power the Japanese Democratic Party (DPJ) in the last diet elections. Despite having made change the center of their electoral campaign, however, the DPJ has so far done little more than enlarge the public debt even further and backtrack on earlier promises made to the U.S by the previous Liberal Democratic (LDP) administration. This is unfortunate, as an even larger public debt and strained relations with its most important ally are only going to make the coming years more difficult for Japan, and will make pulling out of the recession especially hard for the country whose economic model was once admired and emulated around the world.
ReplyDeleteI thought that Japan has been doing very well the past few years. But, their cultural beliefs are preventing them from exceeding further in the economy. It's strange how these beliefs are, even though very significant to them, forcing them into the ground.
ReplyDeleteDoes America have any of these detrimental cultural beliefs? Americans have the reputation of being lazy, fat, and superficial. But what are the actual American characteristics that bring us down in terms of the economy? In terms of helping the environment? Social rights? Any others?
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Wow. Ryan's comment really taught me alot! I think the whole idea of the pressure on women is sad and complicated. Overall, though, it does have a very negative effect on the population, the workforce, and therefore the economy. Why can no one see it? And if they can see it, why doesn't this social pressure change? I also found their way of promoting interesting. I feel as though people should realize that they can break away from some constraining traditions while still maintaining a sense of cutlure and identitiy.
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Gosh, it seems like every article I read has to do with this recession and is just really negative. I wonder if the US is going to be following in Japan's footsteps...I guess I really wouldn't be surprised since we seem to do such a good job of spending money that we don't have. Hopefully, this whole thing gets turned around...and soon.
ReplyDeleteJapan's economy has been tumultuous for a couple of decades, something many Americans don't realize given the seeming success of their car and electronics companies. I'll skip my usual criticism of a lack of proper government intervention in a market bent on destroying itself, and focus on the cultural matter that has been brought up.
ReplyDeleteA couple of years ago one book in the IAS Sophmore Seminar focused on cultural differences between countries and how they shape where they are today. China, as with the rest of East Asia, have a long-held focus on the interdependency of those in the family. While the US does indeed share some of these characteristics, people getting jobs through people they are related to, the book argues that this does not go to nearly the same extent here as it does in China. This limits economic development as people are somewhat reluctant to employ outside the family.
Of course, the United States in general also has some cultural impediments to development. The problem is, like with those of China, U.S. customs are not about to change overnight, even with a concerted effort. What might be economically beneficial (such as a the glorification of learning) cannot, and many would argue should not be undertaken by a government.
In response to Sean's comment, I feel that the Japanese government can solve a great many of Japan's problems without launching any campaign to change Japanese culture. For example, passing laws to prevent companies from forcing women to quit when they get pregnant, passing laws requiring companies to be more accountable to their shareholders, and breaking away from traditional political patronage and pork barreling would do much to boost Japan's economy and would not require the Japanese government to change underlying culture. And while it's true, that some Japanese, mainly the older more traditionally minded sort, may be opposed to some of the more liberal reforms, government actions a never supported by everyone, and many other Japanese would undoubtedly welcome the changes.
ReplyDeleteActually, I believe Japan's culture is changing. Evidence can already be seen from the changes in the use of their language. Words such as "Wife" (in japan, the older generation uses "inside the house" for wife), since "wife" should be the one who takes care of the household in the Japanese society. But amongst the younger generation, a new word has become more popular for the term "wife", which has more of a neutral sense gender-wise.
ReplyDeleteHowever, it is true that Japan is a very "masculine" cultural. In Hofstede's cultural model, which divides cultural into 5 main dimensions, one of which: Masculinity vs feminity. In this particular dimension, Japan scored 95, the highest of all the country investigated by Hofstede. But this was done quite awhile ago. It could really impact their economy if they were able to change this part of their culture. However, culture cannot be changed that easily, afterall, it is what makes Japan what they are today.
As economics has it, no economy can always be doing well, fluctuation of the economy is inevitable. Just hope that individuals don't suffer too much financially.
The world isn't SEEMING to struggle, it IS struggling. It's a global economy and a global crisis. I know we're probably all sick of hearing that - I know I am - but it's still true.
ReplyDeleteRyan brings up a good point: "The Japanese style of promotion, which involves promoting employees based on seniority rather than performance, leaves Japanese businesses less innovative, run by long-time company insiders, without the fresh ideas that come with promoting high-performing, younger employees (or, perhaps, god forbid, company outsiders)."
While I'm sure it isn't this aspect of business that is the cornerstone of the Japanese economy, it certainly doesn't seem to be helping.
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