Historical Dictionary of United States-Japan ... - Bakumatsu Films

Japan should seek to turn its export-oriented economy into a domestic
demand-led economy, relying less on achieving economic parity
with the other industrially developed countries through foreign exchange
rate adjustment. These reports stated that reorientation of the
economy would require demand-side improvements in the quality of
daily life in Japan, a transformation of Japan’s industrial structure
and an expansion of imports. Achieving an industrial structural transformation,
the reports stressed, should be based on utilizing marketincentive
mechanisms. Taken together, the two Maekawa Reports
contained six major recommendations:
1. Expansion of domestic demand for housing, improvements in
the quality of social capital, more effective land usage, the introduction
of capital investment for promoting industrial structural
adjustments, and increased consumption (such as by taking
advantage of the appreciating yen, promoting paid holidays,
and distributing the benefits of improved labor productivity in
the form of higher wages and shorter working hours).
2. Shorter working hours. Japan should adjust the number of working
hours to its economic capabilities. Annual working hours
should be reduced to 1,800 hours by the year 2000. A two-day
weekend for public servants and financial institutions was recommended.
3. Japan should implement an industrial structure harmonious
with international norms. For this purpose, Japan needed to
make changes in five areas: undertake planned industrial structural
adjustment; permit foreign direct investment; improve its
corporate competitiveness both at home and abroad; expansion
of imports; and creation of new agricultural policies suited to
international trade.
4. Japan should focus on improving domestic employment conditions
through the following: stress on the importance of employment;
changes of employment structure and obtaining an
appropriate demand-supply balance; comprehensive employment
measures; redistribution of employment opportunities;
emphasizing the importance of regional economies; and contributing
to the international community.
See also U.S.–JAPAN TRADE CONFLICTS.
MAEKAWA REPORTS • 171