Cartels of japan

Essay by EssaySwap ContributorUniversity, Bachelor's February 2008

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Amid the world today, Japan is a weak link in the chain of the world economies. It is not the miracle it used to be. Japan, after the war, has made some decisions that caused some problems for the future. Those decisions ultimately caused the economic distress it is now striving to get out of. One such decision was the approval of the formation of cartels. This was enhanced with the government passing of the Industries Control Law. This law enable the cartels to control and establish fixed rates in prices, production, and an important link. A link that enables a country to grow, the entrance of new firms. The entrance of firms increases capital, labor, tax revenue etc. The problem surrounding Japan's unfortunate economic distress is due to the governments protectionism, the slowly withdrawal of Japan's key corporations, and the formation of cartels.

Many major problems arose with the governments intervention to protect it's businesses.

The ramifications of those actions are now quite visible, and is now proved to be the wrong methods of controlling an economy. It worked for the circumstances after the war, however, an economy has to adapt to the changing times. What worked for today may not work for tomorrow. The government only witnessed the success of their decisions, however they were unable to adapt that success to continue through the changing times. By protecting their businesses, they were shutting out the rest of the world, and by doing this, they would have to sustain themselves. Not that the world did not want any part of Japan, on the other hand, Japan (because of protectionism) seemed not to want any part of the world. In addition, the protectionism had some bias characteristics to it as well. It seems that the government...