Divided Sun: MITI and the Breakdown of Japanese High-Tech Industrial Policy, 1975-1993
By Scott Callon
Stanford University Press, 1995, 240 pp.
The Origins of Japanese Trade Supremacy: Development and Technology in Asia From 1540 to the Pacific War
By Christopher Howe
University of Chicago Press, 1996, 471 pp.
Here are two worthwhile books on what these days is called "industrial policy" as applied in Japan. Howe of the University of London recounts the evolution of the Japanese economy from the sixteenth century, when it first opened to European trade, to the 1930s. He emphasizes the Meiji era, with an interesting discussion of Japanese colonial policy in Taiwan and Manchuria, and Japan's sense of vulnerability over food supplies and markets for manufactured goods that led it to follow its disastrous path of conquest in the late 1930s. Howe observes that the distinctive blend of public policy and private enterprise that has characterized Japan down to the present has important historical origins. Noteworthy to Japan's commercial success was an early emphasis on education, especially mastery of foreign languages. As in most histories, there is no serious examination of possible alternative paths, so Japan's success is implicitly attributed to the policies it adopted.
Callon in effect takes up the story 40 years later, closely examining the role of the Japanese government, especially the Ministry of International Trade and Industry, in promoting technical and commercial success in electronics and computers. Concretely, he looks closely at the widely heralded government promotion of very large integrated circuits, supercomputers, so-called fifth generation "intelligent" computers, and major new software systems. Callon judges these recent attempts at industrial policy largely to have failed, integrated circuits partially excepted. Even when some technical successes were achieved, they were largely attributable to the actions of individual firms, not collective MITI-sponsored endeavors; MITI’s limited financial support was largely unproductive. He explores the strong interministerial and interfirm rivalries that now make successful concerted action difficult, and the resulting transformation of MITI from a ministry favoring close supervision and guidance of Japanese industry to one leaning strongly toward deregulation.