Stuart Anderson writes in Forbes on new research about Japan’s industrial policy.
- New research from the National Foundation for American policy has found that post-war Japanese industrial policy does not work.
- Specifically, the study found that heavily subsidized industries were the slowest growing sectors of the economy while industries that were driven by private investment were the fastest.
- As the United States looks to accelerate clean technologies, Japan’s industrial strategy provides a cautionary tale. We should embrace economic freedom and private sector innovation, not subsidies and government cronyism.
“Beason found that Japanese industrial policy did not favor ‘rapidly growing sectors’ and gave a great deal of support to business sectors that did not grow much at all. To conduct the research, Beason examined four measures of industrial policy used by the Japanese government during the 1955-1990 period: 1) subsidized government loans to industry, 2) subsidies, 3) tariff protection and 4) tax relief.”
Read the full article here.
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