Wednesday, February 17, 2016

"which was spoken by Jeremy" - Japan and Economics

Around Tokyo

Japan and Economics

What is an object for economics.

Is it to make everybody rich or make a country richer despite the gap between the poor and the rich is increasing?  Or is it intended to serve wealthy people or ambitious guys trying to be wealthy.

In any non-nonsense technology, there is a concrete object to achieve.  But economics has no such object.  It is just reasoning and interpreting economic phenomena.

Economics might be serving governments that are responsible to maintain good economic status of nations.  But what is good economic status?  Avoiding inflation or deflation, or depression or recession?

However, economics itself has no power.  It can have power only when its proposals are adopted by governments.   And, even if it proposes any policies to governments, they are not based on scientific and technological principles.  And, effects of the objects of policies it offers cannot be scientifically evaluated, since it is wealthy people that have the biggest influential power on governments.  If their profits are secured and increased, wealthy people would support a policy economics offers no matter how much it is useless for poor people.

However, it may be thought that economics guides a government to taking reasonable policies to achieve an ideal state of economy of the nation.  But what is the ideal state of economy in one country in the era of globalized economy.

For example, Japan is said to have spent futile 20 years in depression.  Its GDP has just increased a little in these 20 years.  But Japanese have been working hard in these 20 years as before when it marked a great economic growth.  How has economics guided the Japanese Government?

But the fact is that Japanese businesses have shifted their production bases and business activities to foreign countries where labor costs are low and markets are big, in order to cope with globalization of economy.  Japanese businesses relocated plants and factories to China and Southeast Asian countries as well as the US and other countries in other regions.  It helped economic growth of China and ASEAN countries as well as South Korea and Taiwan.  As a result, East Asia became the fastest growing economic zone in the world.

From a global point of view, what Japanese businesses have done in the so-called 20 years has greatly contributed to growth of the world economy.  Indeed, it is better for 2 billion East Asians to be rich than for 120 million Japanese to be much richer.  And it is what Japanese economy has done.  However, no economists proposed such an idea.  

Before the end of WWII, most of East Asia was ruled by the UK, France, the Netherlands, the US, etc.  Part of China was colonized by the UK.  Most of Indochina was colonized by the UK and France.  Indonesia was colonized by the Netherlands.  India was a colony of the UK; the Philippines was a colony of the US.  But today, these regions are enjoying high economic growth due to Japan's contribution.

Economics had no object of making East Asian countries rich before WWII and even 20 years ago.  But what made Japan contribute to the economic success of China, South Korea, Taiwan, Southeast Asian countries, etc.?

The history is above economics.

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Mat 2:17 Then was fulfilled that which was spoken by Jeremy the prophet, saying,
Mat 2:18 In Rama was there a voice heard, lamentation, and weeping, and great mourning, Rachel weeping for her children, and would not be comforted, because they are not.