In the second half of the 20th century, Japan rose from a small defeated nation to a commercial powerhouse second to the United States. Several factors contributed to its success and the entire economic power attached to it at that time. It is exceptionally transitional to see upcountry take advantage of war situations between struggling economies to rise to an excellent economy like Japan did. The war situation between the United States and Russia became a norm rather than an exception to Japan in terms of economic benefits (Palan, 2000, p. 106). It was not entirely based on the culture of the Japanese people but numerous economic approaches that saw it rise to a strong economy. Ranging from political advantages to other economic aggregates like comparative advantages, Japan was able to come second to the United States in terms of powerful global economies. Largely responsible for such success is the fact that Japan had a comparative advantage over the United States, and that is the reason it rose to a higher economy in the 20th century (Xingfenzhen).
As earlier stated, several factors were involved in the success of Japan, but the most instrumental and vocal one is the comparative advantage it has over the United States and other large countries of the world. A country has a comparative advantage over another if it can produce a certain commodity or good at a relatively lower cost than the other countries, even if it does not have an absolute advantage in manufacturing any of the commodities (Cohn, 2011, p.161). In this regard, it is obvious that through specialization, a less productive country may still compete in the global market with other more productive countries. Trading activities can still exist between two countries regardless of the economic rifts in terms of production. In this sense, Japan was able to compete with other countries like the United States in the world market. The United States has productive advantage over every other nation, but the opportunity cost of producing the goods is quite high compared to other less productive countries like Japan and others (Richardmckenzie).
Japan rose to a global economy through trade of vehicles and other mechanical products. The United States produces the same products too but at a higher opportunity cost than Japan. Countries have different levels of efficiencies in production, which means that the United States produces the same vehicles but at a higher opportunity cost than Japan. Seemingly, Japan took advantage of this fact that it could produce vehicles and trade in the world market at a lesser opportunity cost (Palan, 2000, p. 87).
Other factors like culture also helped Japan rise to become second to the United States. Japan’s society is homogeneous in nature with a smaller population that is more dynamic and fewer minority opinions. The factor proved advantageous over the other large countries because a consensus could easily be reached and decisions swiftly made. Japans culture supported commitment in the work place and suppressed individualism, which significantly contributed to its success. The flexible nature of Japans society made it easy for changes of consumer preferences in the 20th century, which is why Japan adjusted quickly and traded more vehicles in the world market. Another factor that was available at Japans disposal was the enculturation process from child-hood to adult-hood (Xingfenzhen).
The Japanese child rearing process and the management practices are advantageous because children in Japan were raised with expectations for the workforce unlike in the U.S where they are trained at a later stage. Lastly, another advantage was Japan’s relationship with the U.S after the cold war. The protection from the U.S military forces was advantageous to it in trading in the world market, and it is why it recovered extremely fast even after the war (Palan, 2000, p. 189). The post-war connections that Japan had with the United States were also politically connected in the sense that elections held in the better part of the 20th century brought in a new wave in the political arena. The newly members elected had not engaged in any problematic disputes in the past years and were better placed to deal with issues of economic revamping. The inert-party corporation among the newly elected members acted like a stepping-stone to Japan becoming an excellent economy (Richardmckenzie).
The realist concepts of competitive advantage and strategic theory differ from the concept of comparative advantage. This is according to one Theodore H. Cohn, in his book “Global Political Economy: Theory and Practice (5th edition)”. According to him, “Liberal theorists view trade as a positive-sum game that provides mutual benefits to states, whereas realists see trade in more competitive terms, with each state striving to improve its exports and reduce its imports” (Cohn, 2011, p.168). In this case, strategic theory seems to be more realistic and aggressive in view of realists considering the idea of competitive advantage.
These two theories disagree because of the fact that it is more advantageous to take control of trading activities through competitive advantage rather than simply taking advantage of the existing natural advantages. Realists are of the view that free trading activities are potentially threatening and unnecessary because of national security. On the other hand, liberal theorists argue that any country engaging in trading activities can win if it plays its role in a free-trade environment. Cohn further explains that overdependence on foreign states for imports of strategic commodities like basic foodstuff may become more of a disadvantage than a fortune in terms of security. He argues that national security is at stake when there is dependence of imports especially if they come from an unfriendly or non-allied country (Cohn, 2011, p.170).
Japans case is best explained by from the liberal perspective because comparative advantage is not necessarily limited to labor activities. A country has competitive benefit in producing goods involving the exhaustive use of its most abundant factors of production and Japan does not have a large population to depend on for labor. Neither does it have extensive land, but it has abundant of highly skilled labor consisting of tradesmen who are unified and supple (Cohn, 2011, p.173). It is therefore, unnecessary for Japan to engage in unskilled labor activities like agricultural produce because the activities are labor intensive and time consuming. The nature of production in Japan’s case involve production of automobiles and electronic products, which explains the reason why Japans comparative advantage lies with these complicated, contrived products. The comparative advantages available at its disposal make Japan a suitable trading partner for countries like Germany because they face similar conditions and their products are more or less alike, and they focus on product differentiation and customer satisfaction (Palan, 2000, p. 187).
References
Cohn, H. T. (2011). Global Political Economy. Canada: Pearson Education Canada
Palan, R. (2000). Global Political Economy: Contemporary Theories. London: Routledge
Richardmckenzie. 1.3 - Comparative Advantage. Retrieved June 19, 2011from
http://www.youtube.com/watch?v=aLeLF622JI
Xingfenzhen. 1/6. The Pacific Century: inside Japan Inc. Retrieved June 19, 2011from
http://www.youtube.com/watch?v=HUi_6_z-6Gc
