Contemporary Export-Led Development in Japan

Japanese export-led industrialization has not been without significant social, political, and environmental problems. Japanese emphasis on production for export markets has resulted in a relative scarcity of consumer items for the Japanese themselves. Consumer items are more expensive in Japan than in the United States. The relatively high cost of consumer items is due in part to the high taxes levied on the purchase of consumer items and restrictions on the import of inexpensive food.

The strategy of export-led industrialization has hinged partially on a somewhat different relationship between business, labor, and government than is characteristic of Western industrial democracies. In contemporary Europe and North America, relationships between business, labor, and government are often mutually antagonistic. Business and labor regularly dispute working conditions and wages, business and government clash over environmental and consumer-protection regulations, and government and labor dispute the rights of labor unions and their members. In Japan, on the other hand, government and business are much more closely allied than is the case in the West.

Japan's powerful Ministry of International Trade and Industry (MITI) was established in order to coordinate the interests of business, government, and labor. Under the sponsorship of MITI, government takes an active role in funding research-and-development efforts. Moreover, the antagonistic relationship between large corporations and labor unions characteristic of Western industrial democracies does not exist in many of the newly industrializing countries. Labor unions are weak, with labor working to cooperate with business in order to achieve the common goal of increased production.

Problems of Export-Led Industrialization.The collaborative partnership between government andbusiness in Japan has resulted in low business taxes and aminimum of government regulation of productionprocesses. One important impact of this lack of regulationis that environmental quality standards are often low.Governments in Japan and other newly industrializedcountries have been reluctant to impose pollution-controlregulations on industrial concerns for fear that such ruleswould impede export production, and thus lower nationalincome. As a result, many of the newly industrializingcountries are experiencing high levels of air and waterpollution. Japan, in fact, is the most environmentally polluted country in the developed world.

The scarcity of consumer goods has resulted in increasing resentment among the residents of newly industrializing countries. An emphasis on saving and reinvesting personal and corporate incomes into the expansion of production facilities has been essential to the rapid industrial development characteristic of export-led industrialization. But this strategy requires a strong work ethic and a spirit of sacrifice on the part of the workforce. Workers are asked to forego consumer purchases in the interest of national development. Many workers, especially those who have lived or traveled in the United States and Europe, are now questioning whether this sacrifice is worthwhile.

Finally, rapid industrial development has often been achieved at the expense of democratic governance. Although some of the newly industrializing countries are nominally democracies, in fact most are dominated by a single strong political party whose actual support among the general population may be tenuous. The Liberal Democratic Party of Japan, has won every national election since the late 1940s, but several of its leaders have been forced out of office as a result of political scandals in recent years. In South Korea, recent internal politics has also been bitter and violent. Opposition to the government by groups of militant students, workers, and intellectuals has been suppressed by force.

The success of export-led industrialization has also generated considerable resentment in the West. In part, this resentment stems from a lack of reciprocal trade agreements. East Asian countries have attempted to flood Western markets with consumer goods while impeding the flow of Western goods into their markets. This imbalance has led some American political leaders to propose tariffs on the importation of East Asian consumer goods.