The Postwar Japanese System: Cultural Economy and Economic Transformation.

• Author: Murayama, Yuzo

By William K. Tabb New York: Oxford University Press, 1995. Pp. 414. $19.95 paper.

The recognized limitations of neoclassical economics and the desirability of integrating social and cultural factors into economic analysis have spurred much recent research. Such research holds particular promise for the study of economic history and development, where institutional changes may have brought about many of the events at issue.

William Tabb's book on the Japanese economic system in the postwar era represents just such research, bringing cultural variables into the explanation of various economic institutions. Thus, he views unique features of the Japanese economy such as the cooperative relations of employers and employees, the industrial policies, and the complex financial-industrial organization known as keiretsu as manifestations of a Japanese cultural economy "in which choices are constrained, behavior is rooted, and institutions are grounded" (p. 295).

Tabb would have us look to this cultural economy in explaining the past, present, and probable future of the Japanese economy. Taking this approach, he analyzes the historical roots and development of the Japanese economy and its unique institutions (chaps. 3 and 4); Japanese manufacturing systems and labor relations, with special reference to the automobile industry (chaps. 5 and 6); the politics of urban and regional policy making and the problems those policies create (chap. 7); Japanese financial institutions and the collapse of the "bubble economy" (chap. 8); and issues related to industrial policy and trade conflicts between Japan and the United States (chap. 9). Tabb explores such topics as how Japanese institutions might change in a new global economy, what roles Japan might play in the economic development of other Asian countries, and the lessons of Japanese experience for the United States.

Consideration of the cultural dimension helps Tabb describe the price Japanese society has paid for rapid economic development. For example, the Japanese manufacturing system receives praise for its efficiency, but it creates great stress for the labor force by the intensity of work and the heavy responsibilities placed on workers (pp. 151-52). Although I cannot agree that the Japanese system of labor relations rests on "the exploitation of labor" (p. 157), no one can deny that the Japanese social and cultural setting has much to do with the establishment and development of Japanese...