Does Japan Speak to Africa?

DOES JAPAN SPEAK TO AFRICA? John P. Powehon Japan has a story to tell to Africa, but it is not one that Africa will want to hear. Nor will development economists, nor will American policymakers. It implies that the policies and theories of all three groups are off the track. Yet, it is a story that all three must not only listen to, but ultimately heed. Japan has been considered a maverick in economic development. "It could not happen the same way elsewhere," economists and policymakers say. The Japanese are disciplined and organized, more so than any country in the Third World. Yet historians have known that Japan and Western Europe, the very two areas with the highest level of industrialization, have strong similarities that date back thirteen to fifteen centuries. Those similarities have not found their way into development theory, and therein lies the deficiency of economists. Therein also lies the bane for American policymakers , who have too much relied on mainstream economic theory. In this article, I will argue thatJapan's secret lies in her history, and one must go far back to find it. Instead of dealing with present-day Japanese behavior, therefore, I go back to the beginning. I will construct a set of hypotheses—call it a theory ifyou like—drawn from bothJapan and Europe. Despite the smallness of sample, I will argue that certain characteristics of John P. Powelson is professor of economics at the University of Colorado, Boulder . Formerly with the International Monetary Fund, Professor Powelson has consulted extensively in Asia, Africa, Latin America, and for the Inter-American Development Bank. His latest book (with William Loehr) is Threat to Development: Pitfalh oftheNIEO (Boulder, Colo.: Westview Press, 1982). The author is indebted to Mary Hey, Grace Goodell, Hidehiro Katsumata, Joyce Lebra, and Eric Ramstetter for valuable comments. 207 208 SAIS REVIEW these two cases must apply to future economic development—logic requires it. Development is far from inevitable—countries may stagnate for centuries —and without the elements common to Japan and Europe, it will not occur. Space and title limit me to the Japan-Africa comparison, but I will make a few references to Europe, as well as to all of the Third World. Economic development requires an interlocking society. This is a pluralist society in which each of many groups both serves and is accountable to at least one, and probably several, other groups. Hierarchies work up and down and in circles. There must be a tolerable balance ofpower among both groups and people. A true market economy may arise out ofan interlocking society, but it cannot bring about such a society. How this society evolves ought to be (but is not) a subject of development economics. It ought to be (but is not) the subject most discussed by policymakers. African elites will not want to hear this story, for it says that concentration of power in central govenment retards rather than promotes economic development. Compromise is an essential ingredient of an interlocking society. Customarily , we think of compromise only at the highest levels, such as in the United Nations or in international peace treaties, or at the lowest levels, such as in families. But compromise is a quality that permeates middle groupings as well, such as municipal and provincial governments and businesses. We also think of compromise as legitimately happening between "good" parties. "Thou shalt not compromise with evil" is almost a commandment. I will argue that Europeans and Japanese learned both the necessity and the techniques of compromise in early medieval times, and they paid off "evil" many times (Danegeld is but one example) to their credit and to everyone's advantage . The closest economists come to a concept ofcompromise is in the theory of bilateral monopoly. A bilateral monopoly occurs when each of two parties is the sole producer of some object that the other party requires, and when the minimum price that each would accept is less than the maximum the other would pay. Assume no political dominance or force. The bargain will be struck at an indefinite point bounded by the maximum-minimum specified . Economics does not have the solution to bilateral monopoly, the student early learns...