Legal Perspective on the Japanese Economic System

Author: Fan Chun
Publisher:
Publish Date: 2006-10-01
Features: After World War II, Japan achieved an economic miracle, and the Japanese economic system that supported its economy was highly praised and admired by the world. However, from the late 1980s to the early 21st century, Japan experienced the formation, development, collapse, and cleanup of its bubble economy. The 1990s saw sustained economic stagnation, particularly the 1997 financial crisis, which shook the world. The main reason for this was the failure of the system. As a result, criticism of the heterogeneity of the Japanese economic system grew louder, with the core issues being excessive government regulation, overdeep intervention in the economy, prolonged isolation from international markets, and excessive non-democracy. It can be seen that the praise and criticism theories have swung the Japanese economic system from the heavens to the ground, creating a stark contrast, which has further drawn international attention to the Japanese economic system. The Japanese economic system holds typical significance in Asia and is worth comprehensive, detailed, and in-depth research. This paper traces the past, present, and future development of the Japanese economic system, using the theoretical tools of new institutional economics and an analytical perspective of history and law to re-examine the Japanese economic system. It attempts to analyze the problems, including what the Japanese economic system is, when it emerged, how it came into being, how it evolved, how it should be reformed in response to new circumstances, and what its prospects are.
After World War II, Japan achieved an economic miracle, and the Japanese economic system that supported its economy was highly praised and admired by the world. However, from the late 1980s to the early 21st century, Japan experienced the formation, development, collapse, and cleanup of its bubble economy. The 1990s saw sustained economic stagnation, particularly the 1997 financial crisis, which shook the world. The main reason for this was the failure of the system. As a result, criticism of the heterogeneity of the Japanese economic system grew louder, with the core issues being excessive government regulation, overdeep intervention in the economy, prolonged isolation from international markets, and excessive non-democracy. It can be seen that the praise and criticism theories have swung the Japanese economic system from the heavens to the ground, creating a stark contrast, which has further drawn international attention to the Japanese economic system. The Japanese economic system holds typical significance in Asia and is worth comprehensive, detailed, and in-depth research. This paper traces the past, present, and future development of the Japanese economic system, using the theoretical tools of new institutional economics and an analytical perspective of history and law to re-examine the Japanese economic system. It attempts to analyze the problems, including what the Japanese economic system is, when it emerged, how it came into being, how it evolved, how it should be reformed in response to new circumstances, and what its prospects are.