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Unformatted text preview: ew businesses. The evidence does not entirely support this
view. Whittaker (1994) asks whether new players
can enter the major corporations league in Japan
and answers unambiguously that they can, despite
undeniable barriers. Whittaker identified these small
and medium-sized firms as a likely source of growth,
and similar cautious optimism is borne out by Imai
and Kawagoe in this issue. Furthermore, Genda
(1998) shows that job creation (as well as destruction) between 1991 and 1995 was highly concentrated in small firms in contrast to the United States
and Britain. This sector, in other words, appears to
be vigorous despite the barriers.
But even if we could discern a lack of new firms in
new industries, would it matter? There is some
evidence that it would not. Wolff (2000) shows that
Japan’s low output and low productivity growth is
not the result of specializing in the ‘wrong industries’. Performance would not have been better if
the country had shifted its industrial structure in the
direction of either Germany or the United States.
Poor performance from 1991 to 1995 resulted not
from a failure to move into high-tech sectors, but
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This note was uploaded on 02/03/2014 for the course ECON 204 taught by Professor Devero during the Summer '13 term at American University of Sharjah.
- Summer '13