Multinationalism, Japanese Style

Multinationalism, Japanese Style: The Political Economy of Outward Dependency

Terutomo Ozawa
Copyright Date: 1979
Pages: 320
  • Cite this Item
  • Book Info
    Multinationalism, Japanese Style
    Book Description:

    Analyzing the motivating forces behind the trend toward Japanese direct overseas production, this work examines the appreciation of the yen, rising labor and energy costs, environmental decay, shortages of industrial sites, and critical dependence on overseas resources as factors in prompting Japanese firms to transfer production facilities abroad.

    Originally published in 1982.

    ThePrinceton Legacy Libraryuses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These paperback editions preserve the original texts of these important books while presenting them in durable paperback editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.

    eISBN: 978-1-4008-5634-3
    Subjects: Business

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. List of Figures and Tables
    (pp. ix-x)
  4. Abbreviations
    (pp. xi-xii)
  5. Foreword
    (pp. xiii-xviii)
    Peter B. Kenen

    Some years ago, I was taken to task by a businessman for speaking about American multinationals. Our company, he said, is no longer American; that is why we say that it is multinational. Unhappily, large numbers of students of multinational business have acquiesced in this interpretation. Some have gone so far as to suggest that the spread of the multinational firm promises to undermine national sovereignty and to bring us at last to the millennium of abstract economic theory. Governments with narrow, parochial concerns will no longer be able to interfere with market forces, and it will be meaningful for...

  6. Preface
    (pp. xix-2)
  7. Chapter 1 Emergence of Japan’s Multinationalism
    (pp. 3-40)

    Japanese corporations have emerged as multinationals, both suddenly and recently. Japan’s rate of growth in direct investment capital outflows has been much higher than that of any other industrial country; according to estimates made by Japan’s Ministry of International Trade and Industry (MITI), the average annual growth rate between 1967 and 1974 was 31.4 percent for Japan, 26.1 percent for West Germany, 10.7 percent for Canada, 10.4 percent for the United States, 9.9 percent for France, and 9.3 percent for the United Kingdom.¹ Although Japan’s postwar overseas investment began in 1951 (when she invested in an iron-ore development project in...

  8. Chapter 2 Peculiarities of the Japanese Experience: Theoretical Considerations
    (pp. 41-75)

    A variety of theories have been advanced to explain the present trend of business firms toward multinational operations, a trend of massive outward expansion which was first noticed in the United States but is now spreading to other industrial countries. Recently, several survey articles interpreting and categorizing these various theories have been published. Two papers (J. H. Dunning, 1973; G. C. Hufbauer, 1975), for example, survey and evaluate major theories and empirical studies; another (T. G. Parry, 1973) discusses policy issues; and a series of U.N. reports from 1973 to 1974 on multinational corporations focuses on the political questions involved,...

  9. Chapter 3 Industrial Transplant in Asia: Spread of Japan’s Dual Industrial Structure
    (pp. 76-110)

    Chapter 1 described how Japan’s successful industrial transformation, in which she shifted her economic structure more toward the heavy and chemical industries, has created strain, because of labor shortages and rising wages, in the labor-intensive segment of her dual industrial structure where small- and medium-sized firms producing mostly traditional light manufactures are concentrated.

    Rapid economic growth ought to have quickly contracted the senile sector, but the political reality of Japan’s ruling political party, the LDP, compelled the government to prolong the life span of that industrial sector by means of various measures designed to rejuvenate it. The transplanting of corporate...

  10. Chapter 4 Direct Investment in Far Away Lands
    (pp. 111-158)

    Outside Asia, the main sphere of Japanese influence, Japan’s overseas investments are no longer so intensively oriented to labor resources in the host countries. In other regions, with both geographical and cultural distances the “cost of being alien” quickly rises. As might be expected, the Japanese manufacturers investing in other regions, particularly in advanced Western markets, are those that possess some type of firm-specific advantage or that endeavor to develop technological and marketing advantages by utilizing, through direct investment, the technology resources of Western economies. In developing regions, such as Latin America and the Middle East, the Japanese government and...

  11. Chapter 5 Japan’s Resource Dependency and Overseas Investment
    (pp. 159-192)

    Japan’s demand for industrial resources has grown enormously in recent years. Among the non-Communist countries Japan now ranks second behind the United States in the consumption of such basic industrial resources as petroleum, copper, zinc, aluminum, nickel, and crude steel. Indeed, Japan’s growth rate of consumption of industrial resources has been the highest in the world. From 1964 to 1968, for example, her demand for petroleum expanded at an average annual rate of 17.6 percent, more than twice the growth rate of the non-Communist countries taken as a whole; her demand for copper increased at an average rate of 11.7...

  12. Chapter 6 Conflict with Local Interests: Economic, Sociocultural, and Political Factors
    (pp. 193-223)

    Japanese firms rushed to set up large numbers of plants overseas, they did so rapidly, and particularly toward the end of the 1960s and in the early 1970s, this development tended to create friction with local interests. Hostility was openly expressed in Thailand and Indonesia by violent anti-Japanese demonstrations during Prime Minister Kakuei Tanaka’s disastrous “goodwill” trips to five Southeast Asian countries in January 1974. The problem was aggravated by the initial inexperience of the Japanese in overseas ventures and their somewhat callow disregard of local attitudes as well as by the unfamiliarity of local people with Japanese ways of...

  13. Chapter 7 General Assessment
    (pp. 224-236)

    A number of Japanese institutions have ventured to predict the size of Japan’s future overseas investments. For example, in March 1972 the Japan Economic Research Center forecast that by 1980 the outstanding balance of Japan’s overseas investments would have increased tenfold from its 1967 level of $2.7 billion to $27.3 billion, a level surpassed only by the United States and West Germany, and that about one-half of the total (50.8 percent) would be in ventures designed to serve the supply of natural resources (mainly, mining), about one-fourth (26.2 percent) in manufacturing designed to use low-cost labor and to capture local...

  14. Appendix. Data on Japan’s Direct Foreign Investment
    (pp. 237-240)
  15. Notes
    (pp. 241-262)
  16. Bibliography
    (pp. 263-276)
  17. Index
    (pp. 277-289)
  18. Back Matter
    (pp. 290-290)