[TencentFinance]GUAN Quan: In the 150th year of the Meiji Restoration, the Japanese Economy Has These Things Worth Learning

This year marks the 150th anniversary of the Meiji Restoration in Japan. The Meiji Restoration opened up the modernization process in Japan and even in East Asia, which is also worthy of China's attention. After the Meiji Restoration, Japan put forward the three slogans of "developing industries, enriching the country and strengthening the military, and civilized", and replaced it with the current saying, that is, "three modernizations." Among them, the more important thing is to cultivate and develop the industry. Japan introduces the advanced technology of Western European countries and uses the original resources to improve. The government is also striving to establish a modern rule of law system, and the society is gradually on the normal track. At the same time, Japan vigorously develops education, so that human resources have been greatly improved and played.

In 1886, after the establishment of the various systems mentioned above, the Japanese economy began to take off and entered the stage of modern economic growth. By the beginning of the 20th century, it took only two or three decades to lead the East Asian countries and narrow the gap with European and American countries. In the first half of the 20th century, Japan’s domestic economy also experienced differentiation while growing. This differentiation has two sides: one side is the urban-rural dual structure, and this structure has not come to an end until the 1960s after World War II, surpassing the "lewisian turning point." The other side is the dual structure between monopolistic large enterprises and competitive small and medium-sized enterprises. This structure came into being along with economic development and gradually disappears with the further development of the economy. Before World War II, it was the monopoly of the chaebol enterprises. After World War II, it was dominated by enterprise groups, but now there is almost no such structure.

In the first half of the 20th century, Japan launched a foreign war to alleviate domestic contradictions. Although it also gained a lot of benefits (such as resources and markets), it eventually failed. The war was a major mistake in the economic development of Japan, and it also had a decisive impact on economic and social development. People realize that it is necessary to follow the path of peaceful development, which has also spurred the determination of the Japanese to catch up with European and American countries. With the economic foundation accumulated before World War II, Japan achieved rapid economic growth and became one of the developed countries.

In the economic development of the past 150 years, Japan has accumulated a lot of valuable experience and left some lessons that are worth learning. First of all, as a late-developing country, when Japan is catching up with the first-mover states, the government and the private sector can, in a sense, unite, which can be explained by Lin Yifu’s "promising government, effective market." In other words, Lin Yifu’s point of view is very appropriate for Japan’s economic development. The promising government is made up of outstanding politicians and officials who can formulate policies and strategies that are consistent with national conditions.

It is worth noting that Japan adopted the constitutional system of the Western countries since the Meiji Restoration. Although the degree of democratization before the Second World War was not very high, even with some feudal factors somehow, politicians are elected by the people. Government officials belong to the civil service system, and long-term positions can guarantee the effective implementation of policies. Before World War II or after World War II, the Japanese government was not a big government but a small government. After the Second World War, Japan was occupied by the United States and democratized reforms were implemented, which further improving the efficiency of the government.

In terms of the market, the early period (Meiji period: 1868-1911) was a full competitive market. With the development of the economy, there has been a monopoly power represented by the "chaebol", which controls the lifeline of the economy. However, the power of the chaebol is limited to the core area, and the majority of SMEs have developed and exercised in the competition. After the Second World War, the Japanese economy was also affected by the monopoly power of the "6 major enterprise groups" evolved from the chaebol, especially during the period of rapid growth. However, with the maturity of the Japanese economy and the bursting of the bubble, as well as the rise of new industries and enterprises, the traditional forces are gradually fading and the market is fairer.

Second, in order to catch up with developed countries, the government has formulated a number of policies that are conducive to economic growth, including lowering interest rates during periods of rapid growth to stimulate private investment, and formulating economic plans to encourage corporate investment. The government has also formulated a number of policies that are conducive to technology introduction and technology research and development, including the establishment of the “industry, government and academy” consortium to lead private enterprises to jointly research new products and processes.

In the long-term competition, private enterprises have formed a pattern in which a few large enterprises coexist with many small and medium-sized enterprises. This pattern has the distinctive characteristics of Japan. One is "series". Some small and medium-sized enterprises provide production and service for large enterprises, and form a long-term and stable mutual trust relationship. Large enterprises support the SMEs in terms of technology and capital. SMEs have spared no effort to maintain this relationship and strive to keep up with large companies in terms of technological improvements. Other independent SMEs either have unique technologies or serve the market directly.

Another characteristic of private enterprises is the unique Japanese-style management method, that is, the lifelong employment system, the annual succession system, the intra-industry unions, and other corporate cultures. This effectively ensures the stability of the employees of the company, especially in the period of rapid economic growth, the company needs experienced employees, thus this kind of culture plays an active role. However, this culture also has its drawbacks. It is the lack of flexibility when the company faces a severe market situation, especially in terms of reducing staff and increasing efficiency, it is easy to hesitate and miss the best opportunity. After the bursting of the bubble economy in the 1990s, this drawback was highlighted, leading to a decline in the competitiveness of Japanese companies and the difficulty of transition. In response to this unfavorable situation, at the beginning of the 21st century, during the Koizumi government period, the policy of “dispatching members” was actively promoted, encouraging enterprises to abandon the lifelong employment system and promote a flexible labor market. Although this kind of policy has played a role to a certain extent, it has also widened the gap in income distribution and brought negative impact on social stability. Therefore, whether this policy is effective or not remains to be seen, because a country's labor market and corporate culture are linked. Under the condition that Japanese traditional culture has not changed, it is not necessarily effective to study the highly-mobility American labor market.

Another characteristic of Japanese corporate culture is that it is coordinated up and down, and the relationship between employers and employees within Japanese companies is harmonious. Because it is a lifelong employment, employees regard the enterprise as their home. If the enterprise does not work well, it will be unemployed. Therefore, there is no passive absenteeism but active efforts. But from another perspective, this is also a problem, that is, the slow decision. On the one hand, the above-mentioned lifelong employment system has led to the decision-makers being too old. They have the advantages of business management experience and tend to be conservative, because of which is easy to lose opportunities when faced with new challenges. However, I personally believe that Chinese companies should absorb Japan's business management model to a certain extent. They should not follow the American-style "efficiency first" model. Because Chinese culture has features from Japan and the United States, it should be eclectic.

(The author is the research fellow of NADS.)