Asia's Flying Geese：How Regionalization Shapes Japan

InAsia'sFlyingGeese,WalterF.HatchtacklesthepuzzleofJapan'sparadoxicallyslowchangeduringtheeconomiccrisisitfacedinthe1990s.Whydidn'tthepurportedlyunstoppablepressuresofglobalizationforcearapidandradicalshiftinJapan'sbusinessmodel?Inabookwithlessonsforthelargerdebateaboutglobalizationanditsimpactonnationaleconomies,HatchshowshowJapanesepoliticalandeconomicelitesdelayed--butcouldnotintheendforestall--thetransformationoftheirdistinctivebrandofcapitalismbytryingtoextendittotherestofAsia.Formostofthe1990s,theregiongrewrapidlyasanincreasinglyintegratedbuthierarchicalgroupofeconomies.Japanesediplomatsandeconomistscametocallthem'flyinggeese.'The'leadgoose'ormostdevelopedeconomy,Japan,suppliedthecapital,technology,andevendevelopmentalnormstosecond-tier"geese"suchasSingaporeandSouthKorea,whichthemselvestradedwithThailand,Malaysia,andthePhilippines,andsoondowntheV-shapedlinetoIndonesiaandcoastalChina.Japan'smodelofcapitalism,whichHatchcalls'relationalism,'wasthusfortified,evenasitbecameincreasinglyoutdated.JapaneseelitesenjoyedenormousbenefitsfromtheirleadershipintheregionaslongastheflockfoundreadymarketsfortheirproductsintheWest.ThedecadefollowingthecollapseofJapan'srealestateandstockmarketswould,however,seetwodevelopmentsthatultimatelyerodedthecountry'seconomicdominance.TheAsianeconomiccrisisinthelate1990sdestabilizedmanyofthesurroundingeconomiesuponwhichJapanhadinsomemeasuredepended,andthePeople'sRepublicofChinagainednewprominenceontheglobalsceneasaneconomicdynamo.Thesechanges,Hatchconcludes,haveforcedrealtransformationinJapan'scorporategovernance,itsdomesticpolitics,andinitsongoingrelationswithitsneighbors.