MITI and the Japanese miracle

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bureaucratic-authoritarian regimes of Argentina, Brazil, Chile, and Uruguay. In these states the ruling elites seek to promote industrialization by excluding from power the previously mobilized economic groups and by developing collaborative relationships with multinational corporations. They do this through a technocratic political arrangement that relies heavily on coercion to enforce the rules of the game.

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Japan differs in that it is a democracy in which the politicians are chosen by the votes of the majority; its stability has rested on the ability of the ruling political party to forge a coalition of voters committed to economic growth and effective management. During high-speed growth this coalition reflected the widespread recognition of Japan's situational imperatives; during the early 1970's the coalition began to weaken markedly, but it appears to have been reinvigorated by the energy crisis and the acceptance of the need for a new shift of industrial structure. Until very recent times the Japanese also have not been hospitable to collaboration with foreign capital. The Korean developmental state, by contrast, seems to share some of the bureaucratic-authoritarian characteristics and should to that extent be distinguished from the postwar Japanese case.

Postwar Japan also differs from the market-socialist states (chiefly Yugoslavia and Hungary), where various experiments have been undertaken to try to synthesize market economics with political control. The contradictory tensions inherent in these systems are more like those of Japan during the period of attempted state control (the late 1930's and 1940's) than they are like Japan after it had regained its independence and launched high-speed growth based on public-private cooperation.

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In addition to occasional protest demonstrations, a probable further consequence of the capitalist developmental system will be the periodic occurrence of "corruption" scandals. These arise because of the separation between reigning and ruling and because of the opportunities this condition gives some insiders to exploit the development programs. As long as these scandals occur primarily among politicians and not among bureaucrats, and as long as the development effort is proceeding to the benefit of the society as a whole, these scandals will be tolerated as unfortunate but not too serious imperfections in the overall system. However, if they occur among the bureaucracy, they signal the need for quick surgery and reconstitution of the system.

The third element of the model is the perfection of market-conforming methods of state intervention in the economy. In implementing its industrial policy, the state must take care to preserve competi-