Unformatted text preview: ties about Japanese trade
surpluses, the chances of success are virtually nil.
Japanese savings will, in consequence, be at least
partially bottled up at home, thus almost certainly
condemning the country to a lower level of income
than the one it could otherwise have achieved.
Domestic reforms could improve this picture somewhat. In certain areas, in which government interference dating back to the 1950s is preventing the
free play of market forces (such as finance), they
are clearly overdue and welcome. Whether changing the country’s distinctive corporate and labourmarket structures, as advocated by some, will be
equally beneficial, is much less certain, as was
argued in section IV. In any case, there is so far, at
least, little evidence suggesting that changes in this
area are particularly rapid.
The overall outlook for Japan is thus not particularly
encouraging. Yet, today’s pessimism may be overdone. This is not the first time over the last half
century that the country has found itself facing an
uncertain future. In the early 1950s, for instance,
Japan hardly exuded confidence. The end of the
Korean War had b...
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