Revisiting the Japanese Economic Model
Inst 310
Gang Guo
In Revisiting the Japanese Economic Model, T.J. Pempel resurrects “Asia’s former behemoth,” Japan, (Pempel, 29) and places him on the stage of economic development models. Pempel implores his readers to not discount the rise and fall of one of Asia’s economic tigers, and makes a convincing argument that despite its sudden and unfortunate demise, the model used in Japan is one that still has applications today. A closer, yet at the same time, broader look at the pros and cons of Japan’s economic model shed light on a truly foreign region of the globe, while also giving guidance to understanding the current and possibly soon-at-hand economic situation of Asia’s newest tiger, China.
Although Pempel’s essay focuses on the already passed rise and fall of Japan’s economy, with occasional glances at neighboring Korea and Taiwan, the points Pempel makes have immediate application to China. The sudden success China has met, along with some economic, political and social factors match up with the factors Pempel points out that led to Japan’s economic model’s success and failure. The global market trend toward liberalization served as the major bump in Japan’s road to continued economic growth. China is fast approaching the same road-block and will soon have to decide how to deal with it and if they can deal with it.
In a commentary on the changing economy of China, Joseph Stiglitz, a Nobel laureate in economics, says that while China’s economy has so far modeled itself after other East Asian countries’ economies, China is now attempting to bypass the problems the other Asian tigers encountered by adapting to a changing global market. He says, “China is attempting to move away from the export-led growth strategy that it and other East Asian countries have pursued.” (Stiglitz) To Stiglitz, this means China will have to drastically improve upon its domestic market, making goods and technologies available to its own citizens.
Interestingly enough, a failure on the part of Japan’s government to focus on its own consumers partly resulted in its economic failure. Pempel says, “…many of the policies pursued in Japan were strongly ‘anti-market’ at home, insulating numerous sectors from international competition and protecting an increasing number of global non-competitive firms at high costs to domestic consumers.” (Pempel, 35,36)
Japan was partly able to shelter its own domestic market export-driven companies because foreign countries were willing to allow them to do so. Stiglitz says that Japan, along with Korea and Taiwan were able to export to the United States, while retaining a relatively closed home market. (Stiglitz, 38) The favor bestowed upon the developing Asian economies shifted, though, with the shift in U.S. foreign relations. Stiglitz says, “…changes in US behavior made it increasingly problematic for old patterns of East Asian insularity to continue.” (Stiglitz, 39) With the recent change in US administration, China should be wary of a different policy line, as compared to that of President Bush’s administration. As reported on in The New York Times, Obama has hinted that he might plan on being tougher with the Chinese economy and more critical of its currency. Although unknown right now, Obama could decide to force China to “let the value of its currency, the yuan, freely float — a move that would let its value rise and would increase the cost of its exports.” (New York Times) Ironically, an undercut currency was also one of the factors leading to the uncovering of those Japanese businesses truly adept at surviving competitively and those dependent upon the government’s protection. (Pempel, 39, 40)
These two factors, a need to shift away from a export-driven economy and foreign countries’ changing economic policies, are simply two of many more comparisons that could be drawn between Pempel’s analysis of Japan’s economy story. Although Japan was unable to quickly adapt to a liberalizing global market, China still has the opportunity to adjust more quickly than its fellow tiger. International pressure is forcing China to reexamine the focus of its economy and how it deals with other countries’ demands. The Japanese economic model and the story of how it played out can serve as a most relevant example to China in identifying the important components of its current economic situation – what is at stake and how to (or not to) deal with it.
Sources: Pempel, T.J., 2005, Revisiting the Japanese Economic Model
Stiglitz, Joseph, 2007, Project Syndicate: China’s New Economic Model, http://www.project-syndicate.org/commentary/stiglitz86
The New York Times, Jan. 22, 2009, Geithner Hints on Harder Line on China Trade, http://www.nytimes.com/2009/01/23/business/worldbusiness/23treasury.html
Globalization and the Silk Roads - Essay
Jessica Moeller
INST 310 – Spring 2009
Globalization and the Silk Roads
January 26th, 2009
The main argument of this reading assignment was the significance of the Silk Roads had not only “trans-civilizationally”, but also trans-ecologically. Because many of the settlements along the Silk Roads that participated in exchange cannot be considered civilizations, the language and mindset used in discussing the impact of the Silk Roads should reflect this fact. The different ecologies of these areas seem to have been largely overlooked as a reason for trade. The idea of trans-ecological differences being the impetuous for trade that Christian discusses seems to be supported by outside sources as well.
Christian is not alone in his view of the importance of trans-ecological trade. Philip D. Curtin argues for the importance of trade across ecological borders in his book Cross-Cultural Trade in World History. He states that ecological differences increase the likelihood of trade. “Goods normally pass across this ecological divide with greater intensity than they do in more homogenous environments” (Curtin 16). Curtin explains the reason for this phenomenon:
Where people lived in a homogenous environment stretching over some distance, there was no obvious incentive to trade beyond the village level; nor was there much reason for specialization within the village where almost everyone was necessarily involved in food production. Where different environments lie side by side, specialization and trade become likely. (Curtin 16)
The “differing resource endowments” that different ecologies provide normally lead the people living in these areas to produce different products and develop different technologies (Curtin 16). Individuals working in agriculture will produce products different than those who herd animals. These individuals are therefore likely to trade their products with each other in order to get products that they do not have and likely cannot make themselves. This simple idea is the basis of trans-ecological exchange.
The geography of the Silk Roads makes the application of this hypothesis fitting. The Silk Roads stretched across many different environments from China to the Mediterranean – from deserts, to arid steppes, to temperate plains. The different flora and fauna of these areas would provide different resources to the people living there. These individuals would therefore be able and likely to produce different products to exchange. Christian’s research seems to have found examples of products being exchanged trans-ecologically in addition to trans-civilizationally.
Another study on a trade route also found difference in ecology to be a reason for trade. Indrajit Ray and Ratna Sarkar’s study of the nineteenth century trade route between Bhutan and Assam found also that trans-ecological trade was important to that trade route. “The nature of the commodities traded between Bhutan and Assam indicates that the trade route gave rise to trans-ecological exchanges in conformity with the hypothesis of Curtin“ (Ray and Sarkar 23). This would be an example that supports the analysis that Christian gives of the Silk Roads trade routes.
It makes sense that trans-ecological differences would be an important reason for trade. It seems that when talking about the Silk Roads trans-civilizational trade has almost solely been discussed and studied. This is likely because civilizations are much easier to study than are smaller communities and are therefore more easily understood. Their importance seems to have overshadowed the importance that ecological differences may have played, though this aspect is now beginning to be researched.
Sources:
Christian, David. Silk Roads or Steppe Roads?: The Silk Roads in World History. Journal of World History, Vol 11, No. 1, 2000.
Curtain, P.D. Cross Cultural Trade in World History. Cambridge: Cambridge University Press. 1985.
Ray, Indrajit and Ratna Sarkar. Reconstructing Nineteenth Century Trade Route between Bhutan and Assam: Evidences from British Political Missions. Journal of Bhutan Studies, Vol. 13, Winter 2005.
INST 310 – Spring 2009
Globalization and the Silk Roads
January 26th, 2009
The main argument of this reading assignment was the significance of the Silk Roads had not only “trans-civilizationally”, but also trans-ecologically. Because many of the settlements along the Silk Roads that participated in exchange cannot be considered civilizations, the language and mindset used in discussing the impact of the Silk Roads should reflect this fact. The different ecologies of these areas seem to have been largely overlooked as a reason for trade. The idea of trans-ecological differences being the impetuous for trade that Christian discusses seems to be supported by outside sources as well.
Christian is not alone in his view of the importance of trans-ecological trade. Philip D. Curtin argues for the importance of trade across ecological borders in his book Cross-Cultural Trade in World History. He states that ecological differences increase the likelihood of trade. “Goods normally pass across this ecological divide with greater intensity than they do in more homogenous environments” (Curtin 16). Curtin explains the reason for this phenomenon:
Where people lived in a homogenous environment stretching over some distance, there was no obvious incentive to trade beyond the village level; nor was there much reason for specialization within the village where almost everyone was necessarily involved in food production. Where different environments lie side by side, specialization and trade become likely. (Curtin 16)
The “differing resource endowments” that different ecologies provide normally lead the people living in these areas to produce different products and develop different technologies (Curtin 16). Individuals working in agriculture will produce products different than those who herd animals. These individuals are therefore likely to trade their products with each other in order to get products that they do not have and likely cannot make themselves. This simple idea is the basis of trans-ecological exchange.
The geography of the Silk Roads makes the application of this hypothesis fitting. The Silk Roads stretched across many different environments from China to the Mediterranean – from deserts, to arid steppes, to temperate plains. The different flora and fauna of these areas would provide different resources to the people living there. These individuals would therefore be able and likely to produce different products to exchange. Christian’s research seems to have found examples of products being exchanged trans-ecologically in addition to trans-civilizationally.
Another study on a trade route also found difference in ecology to be a reason for trade. Indrajit Ray and Ratna Sarkar’s study of the nineteenth century trade route between Bhutan and Assam found also that trans-ecological trade was important to that trade route. “The nature of the commodities traded between Bhutan and Assam indicates that the trade route gave rise to trans-ecological exchanges in conformity with the hypothesis of Curtin“ (Ray and Sarkar 23). This would be an example that supports the analysis that Christian gives of the Silk Roads trade routes.
It makes sense that trans-ecological differences would be an important reason for trade. It seems that when talking about the Silk Roads trans-civilizational trade has almost solely been discussed and studied. This is likely because civilizations are much easier to study than are smaller communities and are therefore more easily understood. Their importance seems to have overshadowed the importance that ecological differences may have played, though this aspect is now beginning to be researched.
Sources:
Christian, David. Silk Roads or Steppe Roads?: The Silk Roads in World History. Journal of World History, Vol 11, No. 1, 2000.
Curtain, P.D. Cross Cultural Trade in World History. Cambridge: Cambridge University Press. 1985.
Ray, Indrajit and Ratna Sarkar. Reconstructing Nineteenth Century Trade Route between Bhutan and Assam: Evidences from British Political Missions. Journal of Bhutan Studies, Vol. 13, Winter 2005.
Syllabus
The University of Mississippi
Spring 2009, Tuesdays and Thursdays, 10:50 - 11:55, 306 Croft Institute
Instructor: Dr. Gang Guo * Office: 128 Deupree Hall * Telephone: (662) 915-5419 * e-mail: gg at olemiss dot edu
Office hours: by appointment
| Overview | Objectives | Structure | Materials | Grades | Schedule |
|---|
Course Overview
This undergraduate seminar course provides an in-depth and multi-disciplinary look at the phenomena, causes, and consequences of globalization. Although most of the course content has a regional focus on East Asia, the theoretical and empirical foundations of many of the issues covered in this course are not strictly constrained to this part of the world and can be easily applied elsewhere.
The course starts with a broad historical overview of the phenomena of globalization as it relates to East Asia. The Silk Road is an early example of globalization in human history, while the experiences of Japan, the "Asian Mini-dragons," and China in the past half-century exemplifies the multi-faceted nature of globalization.
The course then turns to the explanations of globalization, especially from an economics point of view, combining abstract discussions of the important concepts and theories in economic globalization with concrete examples and empirical evidence.
The third part of the course will be devoted to the various consequences of globalization, which fuel many of the contemporary debates on the normative implications of globalization. We will examine the impact of globalization on international relations (neoliberalism, US-China symbiosis, etc.), on democratization, on fiscal policies, on labor rights, on the environment, and so on.
This course is especially suitable for students at the Croft Institute for International Studies because:
- The format of the course is a seminar in a small classroom, with strict limit on the number of students who can enroll in the course. The constraint on class size means more individual attention paid to each student, more opportunities for class participation, questions and answers, better design of course materials adapted to meet students' needs, and easier utilization of instructional and information technologies.
- The course has a substantive emphasis on contemporary real-world issues in global politics and policy. The abstract concepts and theories are illustrated by actual examples and empirical data, and the underlying substantive issues are those that international studies majors are interested in and care about.
- The required readings for each seminar session are real examples of contemporary academic research on the topic of globalization. By critically reviewing other scholars' research products, students can potentially apply the concepts and methods learned in this course to other social science research projects that international studies majors often deal with in their course work or senior theses.
Course Objectives
By the end of the semester, students should be able:
- to understand the basic concepts and theories of globalization;
- to describe and explain the phenomena of globalization in East Asia;
- and to contribute to the contemporary debate on the consequences of globalization as it relates to East Asia.
Course Structure
The format of the course is seminars rather than lectures, and so student participation is not only encouraged but really essential. The class will meet two times a week, each lasting for 75 minutes. It is imperative for students to complete the required reading before each class and attend all class sessions. The seminar is designed to highlight subjects of particular interest or difficulty in an interactive manner rather than for the instructor to lecture on the information presented in the textbook and other course materials. Students are expected to make creative and meaningful contributions to class discussion, not only demonstrating their familiarity with the course content but also critically reviewing the reading assignments for each class. Moreover, much learning will take place outside the classroom setting, such as during group study sessions.
Course Materials
We will be using the following (free online) textbooks for this course:
- Daniel Yergin and Joseph Stanislaw. 2002. Commanding Heights: The Battle Between Government and the Marketplace that is Remaking the Modern World - Episode Three: The New Rules of the Game. ISBN: 1-578079-61-6.
- Wall Street Journal. 2009. WSJ news on East Asia.
- World Bank. 2008. World Development Report 2009: Reshaping Economic Geography. ISBN: 0-8213-7607-1.
The links to reading assignments for each class are listed in the course schedule below. Most of the readings are contemporary journal articles or book chapters of social science research on important topics in globalization and East Asia. Since the reading assignments may be updated on the course website during the semester, students should check back at the course website before each class.
Course Grades
Grades for this course are distributed as follows: class participation 10%; quizzes 10%; annotated bibliography 15%; short essay 15%; first midterm exam 15%; second midterm exam 15%; final exam 20%.
For each class, one student will be responsible for preparing an annotated bibliography of the relevant academic literature on either of the issue areas covered in classes during that week and turning it in on the day before the class. This bibliography should be no more than two or three pages in length. The assignment of students for each week's annotated bibliography will be determined at the first class on January 22nd.
For each class, one student who is not assigned to write annotated bibliography will write a short essay of two or three pages in length on the issue area covered in that class and turn it in on the day before the class. This short essay may expand an argument raised in one of the reading assignment, may react to a controversy covered in an article, may discuss the strengths and weaknesses of the assigned readings, or may examine some of the key concepts, assumptions, major arguments, debates, methodology, measurement issues, substantive contributions, and/or empirical or theoretical implications. The assignment of students for each week's short essay will be determined at the first class on January 22nd.
There are two in-class midterm exams in this course, one on Tuesday, March 3rd, and the other on Thursday, April 2nd. Besides, there are a limited number of unannounced quizzes to be conducted in class on randomly chosen dates.
The final exam will start at noon on Monday, May 4th according to the schedule published by the registrar's office.
Course Schedule
| Month | Date | Day | Topic | Required Reading | Writing Assignment |
|---|---|---|---|---|---|
| January | 22 | Thursday | Course overview and administration | ||
| 27 | Tuesday | Globalization and the Silk Road | Christian 2000: 1-26 | J.M. | |
| 29 | Thursday | Globalization and Japan | Pempel 2005: 29-44 | N.D. | |
| February | 3 | Tuesday | Globalization and the Asian Tigers | Park 2000: 141-168 | K.D. |
| 5 | Thursday | Globalization and China | Huang 2003 and Huang and Khanna 2003: 74-81 | J.M. | |
| 10 | Tuesday | Globalization and the Asian Financial Crisis | Robins 2000: 17-52 | N.D. | |
| 12 | Thursday | Globalization and the APEC | APEC Secretariat 2007 | K.D. | |
| 17 | Tuesday | Globalization and national borders | World Bank 2008: 96-121 | J.M. | |
| 19 | Thursday | Globalization and scale economies | World Bank 2008: 126-145 | N.D. | |
| 24 | Tuesday | Globalization and factor mobility | World Bank 2008: 146-169 | K.D. | |
| 26 | Thursday | Globalization and transport cost | World Bank 2008: 170-193 and Rubin and Tal 2008: 4-7 | J.M. | |
| March | 3 | Tuesday | First midterm exam (also the deadline for course withdrawals) | ||
| 5 | Thursday | Globalization and its critics | Bhagwati 2004: 3-27 | N.D. | |
| 10 | Tuesday | Globalization and international relations | Baldwin 1993: 1-25 | K.D. | |
| 12 | Thursday | Globalization and governance | Waltz 1999: 693-700 | J.M. | |
| 24 | Tuesday | Globalization and democratization | Diamond 1999 and 2000; Nye 2001 | N.D. | |
| 26 | Thursday | Globalization and economic growth | Borensztein, De Gregorio, and Lee 1998: 115-135 | J.M. | |
| 31 | Tuesday | Globalization and education spending | Hecock 2006: 950-961 | K.D. | |
| April | 2 | Thursday | Second midterm exam | ||
| 7 | Tuesday | Globalization and welfare spending | Ha 2008: 783-813 | N.D. | |
| 9 | Thursday | Globalization and fiscal transfers | Hansson and Olofsdotter 2008: 1001-1027 | K.D. | |
| 14 | Tuesday | Globalization and labor rights | Mosley and Uno 2007: 923-948 and Kristof 2009: 1 and 2 | J.M. | |
| 16 | Thursday | Globalization and the environment | Christmann and Taylor 2001: 439-458 | N.D. | |
| 21 | Tuesday | Globalization and culture | Cowen and Barber 2003 | J.M. | |
| 23 | Thursday | Globalization and McWorld | Veseth 2005: 1-9 and 121-143 | K.D. | |
| 28 | Tuesday | Globalization and US-China relations | Landler 2008 | N.D. | |
| 30 | Thursday | Globalization and human consequences | Bauman 2000 | K.D. | |
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