CIRJE Newsletter No.1
Message
Akiyoshi Horiuchi
- Research Activities and Organization
- Financial Crisis, Market Economy, and the Government
- CIRJE Workshops
- Discussion Papers
- Message
- HORIUCHI Akiyoshi, Director
- Japan is facing important structural changes. Various institutions and organizations, which used to support unprecedentedly rapid economic development, no longer work efficiently. The non-performing loan problem, which has been distressing not only the banking industry but also the economy as a whole since the beginning of the 1990s, is just an example of the malfunction of existing institution. Fundamental restructure is necessary in order to revitalize our economy.
- We must investigate the structure of Japanese economy more profoundly than before in order to understand how to reform it. In particular, we need to deepen interdisciplinary researches beyond traditional paradigm, and to extend our analysis based on the perspectives of international comparison. The Center for International Research on the Japanese Economy (CIRJE), established at April 1998 following the Research Institute for the Japanese Economy started at April 1963, purposes to engage in extensive international comparative studies and to collaborate with both domestic and foreign scholars in order to respond to these current necessities. The CIRJE will invite a number of foreign researchers to participate in the joint research with its staffs. The Center will also periodically organize international conferences in which many academicians and practical persons will participate. We believe that these activities will contribute to both producing and disseminating important knowledge usable to overcome the difficulties Japan is facing.
- Your support for the purpose and activities of the Center will be greatly appreciated.
- Research Activities and Organization
- I. Research Activities
- CIRJE research activities are carried out through three departments. Projects undertaken as of December 1998 are listed below after . These activities are to be published through the CIRJE Discussion Paper Series and otherwise opportunities.
- 1. International Comparative Study Department
- This Department is to study the Japanese macro economic situation, business and industry, legal and other institutions, and history from the perspectives of international comparison. It mainly consists of following three fields:
- (a) The Field of International Comparative Study of Japanese Economy
- Information Technology and Market Performance
- Financial System
- Markets of Real Estate and Construction
- Design and Econometric Measurement of Economic Institution
- A Role of Government in Network Industry
- (b) The Field of International Comparative Study of Japanese Firm
- International Comparative Studies of Product System
- Electronic Society and the Marketing Research/Strategy
- (c) The Field of International Comparative Study of History and Institution
- Economics of Law
- International Comparison of Public Financial System
- The Digital Revolution and the Governance of Economic Systems
- 2. Statistical and Historical Material Department
- This Department is to collect statistical data and historical materials and analyze them with the purpose of promoting comparative study in the future.
- (a) The Field of Statistical and Historical Material of Japanese Economy
- The Data Analysis of Post War Stock Market History
- (b) The Field of Joint Research of Statistical and Historical Material Analysis
- The Electronic dissemination of Official Documents: The Status and Perspectives
- 3. International Joint Research Department
- This Department is to organize and manage joint research projects with foreign scholars, and to organize international workshops and conferences.
- International Conference: Financial Crises, Market Economy, and the Government
- This international conference was held September 7-8, 1998, at Sanjo Conference Hall, The University of Tokyo. Report is on following pages.
- II. Organization
CIRJE will work in close relationship with the Faculty of Economics to administer research activities as mentioned in I.
- The CIRJE International Conference
- Financial Crisis, Market Economy, and the Government
- --International Perspective--, September 7-8, 1998
- The Center for International Research on the Japanese Economy (CIRJE) held an international conference to commemorate its establishment on September 7-8, 1998. The conference set up three major themes concerned with the current economic problems confronting Japan and the world economy.
- The theme of the first part of the conference was the financial crisis attacking Japan and South East Asia. The South East Asian countries including Korea and Japan have been suffering from serious financial crisis since the early 1970s. The fragile banking sector with huge amount of non-performing loan problem in the banking sector. Thus, we are facing a vicious circle between the fragility of financial sector and depressive macro economy. Moreover, financial crisis in individual countries of this area not only are interacted with each other, but also they have been seriously influencing economies outside of his area. What policy should we take in order to deal with this financial crisis? The CIRJE conference discussed this policy issue based on the experience we had for the last few years. Some scholars and experts participated in this discussion and exchanged valuable information.
- The theme in the second part of the conference was the role the government should play in the market economy. A well-functioning government is essential for good performance of the market economy. What is the appropriate role of the government in the market economy is, however, a difficult question in practice. We have seen many trials and errors since 1980s, some of which are making dramatic impact. One illustration is the use of novel auction forms to allow market-based allocation to replace administrative allocation. The recent wave of innovation began with the airwave auction in the U. S., which has been adapted for sales of airwaves in several other countries and also applied in deregulating electricity markets. With leading scholars who participated in the development in the novel auction and in its various application, we discussed new directions in the role of the government in market economy.
- Another issue in the second part was how the government can speed the development of a viable private sector in the transferring economies. Easing access to finance promotes the growth of firms, as do policies that assure entrepreneurs they will be allowed to keep the returns on their investment. The CIRJE discussed relative effectiveness of these policies.
- The theme of the third part of the conference was comparative study of international competitiveness in the manufacturing sector. Did the Japanese industries lose its international competitiveness in the late 1990s? This is quite important and serious question. The answer seems to differ sharply depending upon the types of industries. What we need is a series of comparative analyses based on systematic data collection and careful interpretation. Taking manufacturing systems in the auto industry as an example, this part of the conference analyzed relative competitive performance of the European, US and Asian auto manufactures in such fields as production, supplier systems, and product development.
- The specific program of the CIRJE conference is presented below. The CIRJE conference accepted more than one hundred participants in total, and succeeded in stimulating active exchange of opinions among them. We hope the CIRJE will hold another international conference in 1999. The CIRJE have already started planning the conference. The theme will be some issues related to the "crisis" of the pension system.
- PROGRAM
- CIRJE Workshops
- The Workshop on Modern Business Organization
- The purpose of the workshop is to promote communication among researchers in the area of corporate strategy and organizational behavior. The workshop accomplishes this purpose through providing those researchers with a communication place for presenting and discussing their research works. Although formal research conferences play the role of being such a place, this small-group meeting is particularly important for the research activities in their developing stage. Through participating in the workshop, researchers exchange their ideas and develop mutual understanding of the research in the area, which will eventually contribute to the enhancement of our knowledge on business organizations.
- The workshop was organized in June 1995 by faculty members in the field of Markets and Corporations (Business Administration), Faculty of Economics, the University of Tokyo. Those are Professor E. Daito, Professor Y. Umezawa, Professor K. Wada, Professor H. Katahira, Associate Professor T. Fujimoto, Associate Professor N. Takahashi and Associate Professor J. Shintaku and Associate Professor M. Kasuya. Other members of the workshop are graduate students and alumni of the Faculty and researchers outside the university who are interested in business organizations. The total number of the members is about thirty at present. The workshop is held twice a month in average during a semester. In principle, the time is from three to six o'clock on Wednesday, and the place is the Audio-Visual Room.
- In each session of the workshop, one or several members present their own research work in the first half of the time, and then others participate in the discussion in the left time. Members are diverse in their approach to and interest in the strategic or organizational issues of business organizations. Their empirical studies cover firms in various industries: the automobile industry, the electric and electronic industries, the communication industry, the synthetic fiber industry, the chemical industry, the pharmaceutical industry, venture businesses and so on.
- The followings are examples of the topics presented in the workshop in 1998.
- Innovation and Sustainable Competitive Advantage.
- The Internationalization of Japanese Firms.
- The Heterogeneity and the Originality of R&D Terms.
- An Event History Analysis of Mergers.
- Sourcing by Design: Product Architecture and the Supply Chain.
- Empirical Analyses on Similar Behavior of Japanese Competing Firms.
- Interfirm System in Japanese Synthetic Fiber Markers.
- Macroeconomics Workshop
- This workshop's main focus is macroeconomic theory and macroeconomic empirical analysis, but it has a wider scope than a traditional macroeconomic workshop in incorporating, for example, industry analysis and law and economics, so long as they have a macroeconomic perspective. The workshop is usually held on Thursday from 5pm to 6:30pm throughout the academic year. The participants are mainly faculty members and graduate students of the University of Tokyo, but the workshop is open to all economists who are interested in the topic. A bulletin of the future workshop schedule is routinely circulated among other universities and research institutions. Professors Katsuhito Iwai, Hiroshi Yoshikawa and Toshihiro Ihori, and Research Associates Hidehiko Ishihara and Toru Nakazato organize this year's workshop.
- The following are speakers and their titles in the seminars up until September 30, 1998.
- April 23: Taizao Motonishi (Univ. of Tokyo), "A Modification of Harrod-Balassa-Samuelson Model by factor Endowments".
- May 1: John Sutton (London School of Economics), "Technology and Market Structure".
- May 7: Charles W. Calomiris (Columbia Business School), "Bank Capital and Portfolio Management: The 1930s ' Capital Crunch' and Scramble to Shed Risk".
- May 14: Katsuhito Iwai (Univ. of Tokyo), "Persons, Things and Corporations: The Corporate Personality Controversy and Comparative Corporate Governance".
- May 21: Takatoshi Ito (Hitotsubashi Univ.), "Impacts of the Basle Accord on Japanese Banks' Behavior".
- May 28: Kyoji Fukao (Hitotsubashi Univ.), "Foreign direct Investments and the 'Hollowing' of Manufacturing Industries".
- June 4: Takashi Unayama (Univ. of Tokyo), "Technology and Real Exchange Rates".
- June 11: Ken-ichi Ohno (National Gradate Institute for Policy Studies), "Exchange Rate Management in Post-Crisis Asia".
- June 18: Serdar Dinc (Univ. of Tokyo), "The Shareholding Structure of the Japanese Banks and Their Real Estate Lending in 1980s".
- June 25: Ryoichi Imai (Nagoya Univ. of Commerce and Business Administration), "An Equilibrium Model of On-the-Job Search".
- July 9: Takero Doi (Univ. of Tokyo), "Environmental Taxes and Pollution Control in the International Economy: 'Double Dividend' and Tax Reform".
- September 4: Yuji Nakayama (Univ. of Tokyo), "Business Cycle and Location Choice in a Simple Two-Region Economy", Norio Tokioka (Univ. of Tokyo), "Regimes under Selective Liberalization of Capital Flows: Asset Pricing and Welfare Comparisons, Junji Kageyama (Univ. of Tokyo), "The Dissaving Behavior of the Elderly under Uncertain Longevity and the Increasing Longevity".
- September 10: John McMillan (Univ. of California, San Diego), "Contract Enforcement in Transition" and "Interfirm Relationships and Informal Credit in Vietnam".
- Microeconomics Workshop
- This workshop invites a broad range of speakers to discuss the latest research topics in microeconomics. The relevant fields include microeconomic theory, industrial organization, public finance, urban economics, labor, trade, and the other applied topics in microeconomics. The workshop is held on every Tuesday from 4:50 to 6:30 pm throughout the academic year. The faculty members and graduate students of University of Tokyo regularly attend the workshop, but it is also open to all economists who are interested in the topic. The latest seminar schedule can be found on the home page of CIRJE.(#: Joint with TCER)
- April 20: In-Koo Cho (Brown Univ.), "Convergence of Least Square Learning in Self-Referential Discontinuous Stochastic Models" (#)
- April 21: Kazuharu Kiyono (Waseda Univ.), "Global Environmental Management: Incentives for Abatement Investment Anticipating an International Bargaining" (#)
- April 28: Yumiko Baba (Univ. of Tokyo), "The ERM Auctions with Stochastic Equivalent Items"
- May 8: Scott Taylor (Univ. of British Colombia), "The Simple Economics of Easter Island: A Ricardo-Malthus Model of Renewable Resource Use" (#)
- May 12: Quan Wen (Univ. of Windsor), "A Folk Theorem in Repeated Sequential Games" (#)
- May 19: Koichi Miyazaki (Hosei Univ.), "On the Won-Wage Labor Supply Elasticities of Married Workers"(#)
- May 26: Takashi Ui (Bank of Japan), "Robust Equilibria of Potential Games"
- June 2: Michihiro Kandori (Univ. of Tokyo), "Long Term Relationship and Information Accumulation"
- June 9: Akihiko Matsui (Univ. of Tokyo), "Multiple Lenders and Credit Squeeze" (#)
- June 16: Hideo Konishi (Boston Univ.),"Concentration of Competing Retail Stores" (#)
- June 23: Koichi Tadenuma (Hitotsubashi Univ.), "Efficiency-First or Equity-First?: Two Principles and Rationality of Social Choice"
- June 30: Kimitoshi Sato (Asia Univ.), "Well-Being and an Optimal Human Diet as a Composition of Characteristics a la Aumann-Lancaster" (#)
- July 7: Akira Okada (Kyoto Univ.), "Social Development Promoted by Cooperation: A Simple Game Theory" (#)
- July 14: Harrison Cheng (Univ. of Southern California), "Folk Theorem with Imperfect Observation" (#)
- July 21: Wilfred Ethier (Univ. of Pennsylvania), "Regionalism in a Multilateral World"
- September 8: Satoshi Kawanishi (Graduate School of Economics, Univ. of Tokyo), "Smooth Strategy Adjustment Cost and Stochastic Selection"
- October 13: Masayoshi Tanishita (Chuo Univ.), "Conflict of Interests in Social Infrastructure Investment, and Process and Mechanism for Coordination" (in Japanese)
- October 20: Yoshiro Miwa (Univ. of Tokyo), "Political Economy of Reviewing Program for the Antimonopoly Law Exemption of Print Product Resale Price Maintenance" (in Japanese)
- October 27: Daijiro Okada (Hebrew Univ.), "Repeated Games with Strategic Entropy Bound" (#)
- November 10: Takako Fujiwara-Greve (Keio Univ.), "Learning with Forward Looking Players"
- November 17: Peter Hammond (Stanford Univ.), "Proper Rationalizability: Seeking Secure Consequentialist Foundations for Game Theory"
- November 24: Yumiko Baba (Univ. of Tokyo), "Auctions with Heterogeneous Sellers"
- December 1: Takeshi Momi (Graduate School of Economics, Univ. of Tokyo), "Non-Existence of Equilibrium in an Incomplete Stock Market Economy"
- The Research Group on the Contemporary World Economy
- In the 1990s we live in a historical transition period. First, Pax Russo-Americana was over because of the breakdown of the Soviet Union. Second, the Golden Ageof modern capitalism in Pax Americana was also over in the 1970s. We do not have a stable political and economical system any more. From the viewpoint of the present transition period, how can we formulate a historical transformation of modern capitalism in the twentieth century?
- The purpose of this research group is to promote cooperative research works on the structural change in the contemporary world economy. It has five small research groups; (1) on the international trade and finance, (2) on the US economy, (3) on the economy of Europe, (4) on the Japanese economy and (5) on the world economy and business cycle.
- The number of members is now twenty-five. The research meeting is held, on principle, four times in every year. In the meeting, one of the group members gives a presentation, followed by members' discussion on the issues raised from it.
- The meetings from December 1997 to September 1998 were as follows:
- December 20: Mitsuhiko Takumi (Rissho Univ.), "On the Modern Floating Exchange Rate System".
- March 16: Masao Yokouchi (Hosei Univ.), "On the Asian Monetary Crisis".
- September 19: Tsuneo Mori (Meiji Univ.), "Blair's Public Finance Policy and the British Economy".
- Through these meetings, an idea to work out a series of books on the contemporary world economy has grown. A Publisher, Nihon-hyoronsha is interested in the idea, and agrees to publish five books in a series.
- The Research Group on the Asian Automobile Industry
- This has been a very busy year for The Research Group on the Asian Automobile Industry (formerly The Research Group on the Korean Automobile Industry). After the merger of the Korean and Chinese Automobile Industry Research Groups, we have held regular meetings more frequently--8 times in 1998. Here is the list of the lectures in the past year.
- September 1997: Present and Futre of Thai Auto Industry (Mr. R. Takahashi, Mitsubishi Corp.)
- November 1997: Recent Economic Trends in ASEAN and the Auto Industry (Ms. L. Astier, J. D. Power)
- January 1998: Taiwanese Investment in China-Don-Nan Automobile Company (Prof. C. Chen, Taiwan Univ.),
- March 1998: Problem Solving Process in the Product Development of the Auto Parts Suppliers (Ms. M. Han, Univ. of Tokyo)
- May 1998: Asian Auto Market and Japanese Auto Makers (Prof. K. Shimokawa, Hosei Univ.)
- June 1998: Development and Failure of Korean Auto Industry (Ms. J. Mizuno, Institute of Developing Economies)
- July 1998: Chinese Auto Distribution System--Why Multiple Tier? (Prof. H. Shioji and Mr. H. Ryu, Kyoto Univ.)
- September 1998: ASEAN Auto Industry and the Market Situation (Mr. H. Miyagaki, Mitsubishi Corp.)
- October 1998: Toyota in Indonesia--Case Study on the Transfer of the Toyota Production System (Prof. K. Nakamura, Univ. of Tokyo)
- The number of attendants also increased significantly--over 50 people participated in some of the meetings, and we had hard time finding a room that is large enough for the audience. Mr. K. Ko, Mr. J. Oh and Ms. M. Han worked hard as organizers for the group (by T. Fujimoto). As the crisis of Asian Economy continues, it has increasingly become important for practitioners and academic researchers in this field to maintain and strengthen international networks of empirical researches like this one.
- Political Economy Workshop
- The purpose of this workshop is to promote communication among researchers in the area of political economy. The participants are mainly faculty members and graduate students of Tokyo University, but the workshop is open to all political economists who are interested in the topic. Professors Michiaki Obata and Tokutaro Shibata organized this year's workshop. The seminars from September 1997 to October 1998 were as follows:
- September 18: Juro Hashimoto (Institute of Social Science, Univ. of Tokyo), "When and How was the Japanese Enterprise and Economic System Created?"
- October 20: Takumi Omori (Graduate School of Economics, Univ. of Tokyo), "Insurance System and Capitalism".
- October 27: Yuzo Hirano (Graduate School of Economics, Univ. of Tokyo), "Credit Theory and the Transaction of Money".
- November 17: Masaru Kaneko (Hosei Univ.), "Political Economy of Market and Institution".
- April 1: Gary Dymski (Univ. of California, Riverside), "The Boom Economy and Banking Structure: A Minsky Perspective on Los Angeles, Japanese, and Korean Bubbles".
- April 6: Geoffrey M. Hodgson (Univ. of Cambridge), "The Ubiquity of Habits and Rules".
- May 25: Kiyoshi Hamashima (Graduate School of Economics, Univ. of Tokyo), "State, Institution, and Market in the Development Economics".
- October 23: Robert Boyer (CEPREMAP, CNRS, and EHESS), "Two Crises of Embedded Capitalism: Germany and Japan Compared".