Abstract

The article focuses on the internationalization of the Japanese Economy. Foreign businesspeople have experienced difficulty in selling to or investing in the Japanese market. Often, they explain their frustration in terms of Japan's allegedly closed economy. This article explores why and how Japan's economy was closed and details efforts made in recent years to open it. It rejects the argument that Japan's culture is itself a nontariff barrier to trade and instead argues that Japanese government policy has been the main barrier. Underlying this analysis is a comparison of the Japanese capitalist developmental state and the American regulatory state. Japan today is one of the world's richest nations. More important, a generational change of profound significance is occurring in Japan. Young and middle-aged Japanese, born in the 1950s and 1960s, are just now achieving responsible positions in government and private industry. They can be expected to persist with the internationalization of the economy since it has become fundamental to Japan's continued prosperity.