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Institutions, Industrial Upgrading, and Economic Performance in Japan

The ‘Flying Geese’ Paradigm of Catch-up Growth Terutomo Ozawa, Emeritus Professor of Economics, Colorado State University and Research Associate, Center on Japanese Economy and Business, Columbia Business School, US
Terutomo Ozawa examines Japan’s once celebrated post-war economic success from a new perspective. He applies a ‘flying geese’ model of industrial upgrading in a country that is still catching-up, to explore the rise, fall and rebound of Japanese industry with its evolving institutions and policies.
Extent: 256 pp
Hardback Price: $135.00 Web: $121.50
Publication Date: 2005
ISBN: 978 1 84376 959 0
Availability: In Stock
Paperback Price: $60.00 Web: $48.00
Publication Date: 2007
ISBN: 978 1 84720 197 3
Availability: In Stock
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Terutomo Ozawa examines Japan’s once celebrated post-war economic success from a new perspective. He applies a ‘flying geese’ model of industrial upgrading in a country that is still catching-up, to explore the rise, fall and rebound of Japanese industry with its evolving institutions and policies.

The book brings together and expands upon theories developed in the author's work over many years, using them as building blocks for his flying geese model. Concepts explored include:

• economics of hierarchical concatenation, increasing factor incongruity, comparative advantage (or market) recycling
• the Ricardo–Hicksian trap of industrial production, Smithian growth elan, triumvirate pro-trade structural transformation
• knowledge creation versus knowledge diversion, the price-knowledge/industry-flow mechanism ‘a la David Hume’
• the syndrome of institutional incongruity, and socially justifiable moral hazard versus degenerative moral hazard.

The dynamic process of industrial upgrading is analysed in detail, and important lessons for both developing and transition economies are highlighted.

This fascinating book will attract a wide-ranging readership, encompassing practitioners and academics interested in international business, economic development, trade, and political science. In addition, sociologists focussing on business and industry, and researchers on, and policymakers in, developing and transition economies will also find this book of immense interest.
‘. . . the book reviewed here will trigger a further interest in this area of research, and will invite more researchers to seek empirical evidence in the study of post-war industrial growth in Japan.’
– Hiroshi Ohashi, Journal of the Japanese and International Economies

‘This book provides a theoretically informed and empirically illustrative account of modern Japanese industrialization. Ozawa’s translation of classical political economy to the Japanese context is both original and accessible and is a welcome addition to the literature on the Japanese variety of capitalism.’
– Tim Reiffenstein, Pacific Affairs

‘Ozawa succeeds in extending, building up, and joining the Akamatsu–Kojima lineage of this unique Japan-born theory of economic development from a fresh, unconventional, and discerning perspective.’
– From the foreword by Kiyoshi Kojima
Contents: Foreword by Kiyoshi Kojima Preface Part I: Post-WWII Growth Clustering and Japan as a Second Goose 1. Hegemon-Led Growth Clustering and the Flying-Geese Paradigm of Catch-up Growth Part II: Out of, and Beyond, the Limit of Borrowed Knowledge and Home-Spun Goods 2. Labor-Driven Stage – and Logic – of Reconstruction 3. Scale-Driven Stage – and Logic – of Modernizing Heavy and Chemical Industries: A High Growth Period 4. Assembly-Driven Stage – and Logic – of Industrial Upgrading 5. Knowledge-Driven Stage – and Logic – of Catch-up Growth 6. IT-Driven Stage – and Logic – of New Growth 7. Analytics and Stylized Features of Structural Transformation: Additional Theoretical Expositions Part III: Changes in Institutions and Industrial Organization: Toward the Reform-Driven, M&A-Active Period of Growth 8. Network Capitalism: Industrial Organization in Evolution 9. Out of an Institutional Quagmire? International Business to the Rescue Bibliography Index