2-18 - Last week: Begin microeconomic discussion of Japan,...

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Last week: Begin microeconomic discussion of Japan, Taiwan, Korea Insane schematic diagram of a keiretsu This week: Finish microeconomic discussion Industrial policy Begin macroeconomic discussion, time permitting Next week: Macro Week after that: Midterm: Conceptual overview part + Japan, Taiwan, Korea part, 1 hour long Keiretsu Advantages: Information sharing Controversial advantage: Main bank plays supervisory role, without them, management becomes insulated and ineffective No market for corporate control because equity is held by other companies, very illiquid Effectiveness of supervisory process debatable Encouragement of employer-specific unions – e.g., Toyota union, not auto union Industrial unions were crushed In Korea, unions were banned under Park Chung-hee Korea: Toothless, official unions and radical underground unions Conflict exploded in the 1980s Blue collar labor moved around a lot Example: car factory workers are rotated throughout the assembly line Thus, highly skilled workers who can work anywhere on the assembly line Emphasis on quality control during production rather than after Individual workers could stop the assembly line if they saw a problem Toyota production system: Inventory management system that allowed Japanese to have very low inventories 1. Notion that consumers have ideal varieties a. Customization for consumers b. Disadvantage: increase in costs c. Also increase in factory changeovers i. Must stop production to do changeover d. Conflict between production and marketing i. Faster changeovers lead to more marketing for individualized cars e. dd 2. ddd Helicopter factory
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Administrative building above the assembly line building Machine tools building, parts building Machine tools and parts both centralized New method: Decentralize parts and machine tools Place the appropriate pieces next to their respective stations Result: So effective that production line could be completely changed in only 24 hours Conclusion: Japanese blue collar workers extremely efficient But Japanese white collar workers highly inefficient
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2-18 - Last week: Begin microeconomic discussion of Japan,...

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