Author: Assistant Professor Alan D. Partee Ph.D. (Waseda University)

Ibaraki Christian University: Professor of International and Business Studies.
Japan Ibaraki Ken, Hitachi City Omika-cho 3-15-1

203 San Hiruta Omika

Phone 090-6106-1179

polki69@yahoo.com

FAX 03-3465-8744

E-mailEconomic Policy as Market Coordination in Japan and China
The state seldom remains as developmental, anti-statist, or corporatist in the policymaking
and implementation process over time, not only because of the dynamic state-society relations butalso because of the bureaucratic politics within the state that greatly affects the actions of the state
which exercises some transformative power over the “rules of the game” operating as coordination
within the society and the market. The institutions of the industrial structure, the strategies
adopted by major producers, the coordination provided and the people involved in sectoral politics
are not necessarily the same through time (see for example, Friedman 1988 pp.1-134) so that thestate in one sector may play radically different roles in other sectors (see for example, Krasner 1978
pp.34-127). To make things more complex, changes in international political economy may provoke
a radical shift in the role of the state in industrial adjustment (Haggard and Kaufman 1992
pp.1-22), especially in the economies that are heavily dependent upon international trade such as
Taiwan and Japan. But the adjustment strategies are not necessarily the same due in part to thedifferent domestic political economic structures represented as the rules of the game. (see forexample, Stallings 1992 pp.41-86 and Kahler 1992 pp.89-138). Just like the liberal economic regime
during the 1950s and 1960s provided good chances to East Asian late developers, theneo-protectionist tendency of the advanced industrial countries after the 1970s has imposed
significant constraints upon the same group of countries.
The existing literature on East Asian development provides unique sets of explanations
about the role of the state in the process of development and the ways that industrial policies areshaped. They argue that industrial policies are the direct outcomes of the structures and actions of
the state (the statist approach), of free market competition and utility maximization among interest
groups and/or various market factors (the anti-statist approach), of concentration of interests
between the state and capitalists without the participation of labor unions (developmentalcorporatism), of embedded autonomy of the state-society relations (embedded autonomy argument),of distinctive sectoral politics and production strategies as in Friedman (1988 pp.1-98), or of global
division of labor and production networks.
Some studies, mostly the neo-classical economic literature, tend to freeze in time, as beingfixed or static, state and state-society or state-business relations in development, and thereby
fallaciously see them as historically and/or structurally invariable through time. Thus when acommitted anti-statist studies East Asian development, he/she tends to view the state as
anti-statist and to look for the ways in which a plurality of interest groups have inputs into thepolicy-making process.