The Public Interest

Japan's Galbraithian Economy

Martin Bronfenbrenner

Fall 1970

Japan’s remarkable economy has been growing, in recent years, at the rate of 10-12 per cent a year. At the present rate---if it can be maintained--Japan will be the second largest industrial power (based on GNP) in the 1980's, and conceivably could be the first in the year 2000. What is the "secret" of Japan's economic growth--a record which has now outstripped the Soviet Union, and which makes the 19th century history of Western capitalism look pale? The answer lies in a unique combination of Japanese industrial conglomerates—Zaibatsu--tied to a centralized financial-investment structure, and a savings rate, accepted by a compliant population, which is the highest in the world. It is a remarkable combination of a "protestant ethic” with a Galbraithian-type economy.

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