Introduction to Japanese Economy

Fall 2018

Syllabus

2019/02/25

Ryoichi Imai

International Student Center, Kyushu University

My JTW Course Page

Contents

1.     Course Outline

2.     Organization, Attendance, and Other Requirements

3.     Pre-requisites

4.     Assessment Details

5.     Schedule and Readings

Course Outline

The course is designed to provide some introductory knowledge of Japanese economy. Students will learn the essence of historical and institutional background of Japanese Economy. In this course, we will focus on the structural issue of Japanese economy as a background of the 10 year depression since the crush of the bubble economy in 1990.

Key words of this course: Corporate organization and governance, financial system and corporate groups, competition and business strategies, exchange rate regimes and international capital flows, productivity gap across industries, aging society, education and meritocracy, economic development and class stratification, and others.

Organization, Attendance, and Other Requirements

Lecture notes are to be uploaded on the course website.

The class starts with a series of lecture given by the instructor. Later the students present some selected reading materials. Each course attendant is required to do at least ONE oral presentation of the articles assigned by the instructor. The presenter must make a set of PowerPoint Slides. There is one midterm or final examination, which might be open-book or take home one.

Pre-requisite

None. Any knowledge on macroeconomics or microeconomics will be useful.

Assessment Details

You can get two credits by satisfying the following three requirements.

1.     Class Attendance and Discussion 20%

According to the government guideline, no students are allowed to take the course final examination, if they do not show up in more than 1/3 of the class meetings. The government has set up a more rigorous grading standard on credits.

2.     Presentation 40%

3.     Final Examination 40%

If you need to acquire three credits in accordance with the credit transfer policy of your home university, you can get three credits by making a second presentation in different topics in addition to the requirements as above.

Schedule and Readings (subject to Change)

PART I: Lecture

1.     (10/03) E01. Introduction

We will review the development of Japanese economy during the last two decades focusing on the four crisis episodes:

Crash of the Bubble Economy 1990

Asia Currency Crisis 1997-98

Crash of the IT bubble 2000.

The 'Subprime' Crisis 2007-

Krugman, Paul (1994), The Myth of Asia's Miracle, Foreign Affairs.

Productivity Slowdown and Structural Reforms

Hayashi, Fumio and Edward C. Prescott [2002], The 1990s in Japan: A Lost Decade, Review of Economic Dynamics, 206-235.

Prescott, Edward C. [2002], Prosperity and Depression, American Economic Review, 92(2), 1-15. Downloadable in the campus.

Caballero, Hoshi, and Kashyap (2008), Zombie Lending and Depressed Restructuring in Japan, American Economic Review, 98(5), 19431977.

Japanese Economy changed not in 1990 but in 1997

BOJ Governor Shirakawa (2012) Central Banking: Before, During, and After the Crisis

Iwamoto (2011): The Quantity Theory under Liquidity Trap (J)

Higuchi (2015) Neets, Freeters, and Job Separation for Elderly Care in Middle Age  (J)

Reuters (2015) Japan PM calls for steps to achieve a $5 trillion economy (E) (J)

Secular Stagnation

The Real-Effective Foreign Exchange Rates

FRB (2013) The Great Moderation 1980-2007

Eggertsson and Mehrotra (2014) A Model of Secular Stagnation, VOXEU

Lawrence Summers: Secular Stagnation Page

Robert Gordon (2016) The Rise and Fall of American Growth, Princeton University Press

Robert Gordon (2017a) Secular Stagnation: A Supply-Side View

Robert Gordon (2017b) AI and Employment: Misplaced Fears

Robert Gordon (2018) Monetary Tools, Financial Reforms, and the Next Financial Crisis

Robert Gordon Slides

2.     (10/17) Introduction 2

3.     (10/24) Introduction 3

4.     (10/31) Introduction 4

5.      (11/07) E02. Corporate Governance
Iwai, Katsuhito (2002), The Nature of the Business Corporation: Its Legal Structure and Economic Functions, Japanese Economic Review 53(3), 243-273.
Carlo‚“ Ghosn – Japan Times
The Nissan Case
Modelling the Japanese Firms – Masahiko Aoki
     Toward a Comparative Institutional Analysis
    
A Model of the Firm as a Stockholder-Employee Cooperative Game (Download it in Kyudai)
The Share Economy -  Martin Weitzman

6.     (11/14) E03. The Japanese Employment System (Rebick: Ch. 2)
Gordon, Robert J. (2006), Issues in the Comparison of Welfare Between Europe and the United States.

7.     (11/21) E04. More on Labor Market Issues

8.     (11/28) E04. More on Labor Market Issues
Kocherlakota (2010) Modern Macroeconomic Models as Tools for Economic Policy
OECD indicators on employment protection
black companies – The Japan Times
black company (Wikipedia)
junior labor market tightness (Recruit Works)

9.      (12/05) Inequality Debates
Inequality in Japan: Overview

E06. Reconsidering Inequality
Inequality in Japan Updated
Inequality 2015 (in Japanese)
Globalization and Inequality (in Japanese)
Branko Milanovic
The World Top Income Database

Autor, Katz, and Kearney (2007), The Polarization of the U.S. Labor Market
Thomas Piketty
Thomas Pikettyfs lecture at LSE 2014 on wealth inequality
Gabriel Zucman
Krusell and Smith (2014) Is Pikettyfs gSecond Law of Capitalismh Fundamental?
Matthew Rognlie (2014) A Note on Piketty and Diminishing Returns to Capital
Bonnet, Bono, Chapelle, and Wasmer (2014), Capital is not back: A comment on Thomas Pikettyfs eCapital in the 21st Centuryf
--- (2014), Does housing capital contribute to inequality? A comment on Thomas Pikettyfs Capital in the 21st Century

10.   (12/12) Inequality Debates continued

11.   (12/19) Inequality Debates continued

-----Winter Break-----

12.   (1/09) Long-run Development
Clark and Ishii (2012) Social Mobility in Japan, 1868-2012:  The Surprising Persistence of the Samurai, University of California, Davis
Japan and the Great Divergence, 725 to 1874
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voxeu article
Agricultural Land Survey 1598-1872 (in Japanese)

PART II: Students' Presentations

Rosenbluth and Thies (2010): Japan Transformed

13.  (1/15 Tuesday: Confirmed): no class on 16 due to my administration obligation
Chapters 1, 2, 3
Presenters: Yassine, Lea, Emma, Caroline

14.  (1/23) Chapters 4, 5, 6
Presenters: Kostas, Mike, Sabine, Caroline

15.  (1/30) Chapters 7, 8, 9, Epilogue
Presenters: Doris, Darylle, Heoyon, Kostas

16.  Final Exam
Final Take-home Examination (NEW 2019)

Extra Readings

General

Hiroshi Yoshikawa (2001), The Aging of Society and Fiscal Policy, in Japan's Lost Decade, International House of Japan.
Hiroshi Yoshikawa (2001), Exchange Rates, in Japan's Lost Decade, International House of Japan.
Hiroshi Yoshikawa (2001), Japan's Manufacturing and Nonmanufacturing Industries, in Japan's Lost Decade, International House of Japan.

Social Security

Angry blog post sparks movement for improved day care
Japanfs top buzzword candidates for 2016

Financial System

*Hoshi, Takeo and Anil K. Kashyap (2004) Costs and Benefits of Keiretsu Financing, in Corporate Financing and Governance in Japan, Cambridge MA: MIT Press

Hoshi, Takeo and Anil K. Kashyap (2005), Solutions to Japan's Banking Problems: What Might Work and What Definitely Will Fail,  in Reviving Japan's Economy, MIT Press 

Hoshi Takeo (2006) Economics of the Living Dead.

Allen, F. and M. Zhao (2007) The Corporate Governance Model of Japan: Shareholders are not Rulers.

Baumol, Litan, and Schramm (2007), Capitalism: The Big-Firm Wealthy Economies: Preventing Retreat and Stagnation, in Good Capitalism, Bad Capitalism, and the Economics of Growth and Prosperity., Yale University Press.

Iwamoto, Yasushi (2002), The Fiscal Investment and Loan Program in Transition, Journal of the Japan and International Economics 16, 583-604.

Technology and Innovation 

Gordon, Robert J. [2000], Does the "New Economy" Measure up to the Great Inventions of the Past?, Journal of Economic Perspectives 14, 49-74.

Intellectual Property Rights

*Scotchmer (2004), Innovation and Incentives, Ch.2.

Global Financial Crises 

Allen and Gale (2007), Understanding Financial Crises, Ch.1

Ito, Takatoshi  (2004) Exchange rate regimes and monetary policy cooperation: Lessons from East Asia and Latin America, Japanese Economic Review, 55(3), 240-266,

McKinnon, Ronald, and Kenichi Ohno (1997), Dollar and Yen, MIT Press.

Adrian, T., and H. S. Shin (2008) Liquidity and Financial Contagion
The Becker-Posner Blog: Bail Out the Big Three Auto Producers? Not a Good Idea-Becker, Nov. 16, 2008.

Robert E. Hall and Susan E. Woodward (2008), The Financial Crisis and the Recession: What is Happening and What the Government Should Do.

Labor Market and Social Security

Hashimoto, Masanori and Yoshio Higuchi [2005], Issues Facing the Japanese Labor Market, in Reviving Japan's Economy, MIT Press.

Raymo, James M. and Miho Iwasawa [2005], Marriage Market Mismatches in Japan: An Alternative View of the Relationship between Women's Education and Marriage, American Sociological Review, 70, October, 801-822.

Morishima, Michio (2000), The Japanese Financial System: Its Solidarity and Vulnerability, in Japan at a Deadlock, Macmillan UK.

TAKASHI OSHIO AND WATARU SENO (2007), The Economics of Education in Japan, The Japanese Economy, 35(1), 46-81.

Patricia Boling (2008): Demography, Culture, and Policy: Understanding Japan's Low Fertility (Download pdf. file.)

Women's Economic Status and Fertility: Japan in Cross-National Perspective
S
Shirahase - The Political Economy of Japan's Low Fertility, 2007

OECD Report (2002): Health Care Reform in Japan
Porter and Teisberg (2004): Redefining Competition in Health Care

Toshimitsu Shinkawa (2006) The politics of pension reform in Japan: Institutional legacies, credit-claiming and blame avoidance,  in Ageing and Pension Reform around the World.