Japanese Cities

9 The Decline and Renaissance of the Steel Town THE CASE OF KAMAISHI

9 The Decline and Renaissance of the Steel Town THE CASE OF KAMAISHI Masatoshi Yorimitsu Postwar Japanese economic development can be divided into three stages: the postwar recovery period, a high-growth period, and a low-growth period. The 1980s, the stage of low growth, have been a major turning point in Japanese society and economy. Changes are in progress at three levels: Japan's position in the world economy, Japan's domestic economic system, and Japan's regional economy. On-going changes at all three levels must be borne in mind when we analyze the particular problems facing cities and towns in Japan today. JAPAN'S TURNING POINT A Changing Position in the World Economy Although postwar Japanese economic development has attracted world interest, Japan's position in the world economy in the past ten years has become the major object of attention. Just after World War II, conditions in Japan were very harsh: production facilities and railroads had been destroyed, productivity was below prewar standards, urban buildings had been severely damaged by air raids, and a majority of the Japanese were starving. Today, having recovered from difficult conditions and had a period of high economic 203 Masatoshi Yorimitsu growth, Japan is a world economic power producing 10 percent of the world's GNP. Various factors are behind Japan's postwar rise to economic power. What is to be particularly emphasized here is that Japanese manufacturers actively introduced foreign technologies, revising them to make them comfortable for the Japanese, and that labor and management worked together to produce better goods at lower cost. As a result, Japanese manufacturing became competitive in the world market. While Japan 's trade balance radically improved with the nation's improved manufacturing performance, excessive exports of manufactured products caused frictions with Japan's trade partners. To circumvent these frictions , Japan increased direct foreign investment and became the world's largest creditor nation (Karatsu 1988). As one of the world's economic powers, Japan must playa different role from the one it played as an economically weak nation. Japan is now expected to contribute to the world economy by helping to coordinate economic activities among advanced countries and between advanced and developing countries. Coordinating economic activities from the standpoint of the world economy means not only solving economic problems among countries but also changing the internal structure of the Japanese economy (Economic Planning Agency 1988). Major reorientation of Japan's economic structure has meant, first of all, shifting from export dependency to dependence on domestic demand . Second, as a technologically advanced nation, Japan must actively promote technology transfer to developing nations in order to help to solve North-South problems. Because Japan intends to transfer newly developed industrial technology, Japan must playa leading role in the development of basic research. Japan can thus contribute to the world by diffusing its achievement (MITI 1988). Changes in the Domestic Economic System The postwar Japanese economy took on a pattern of export dependency. Goods were made from imported raw materials and resources, and expenditures for imports were paid for by exporting finished products. Products such as textiles and steel in the early stage and then television sets, VCRs, cars, and semiconductors later on became highly competitive in the world market. These products, designed for mass production and mass consumption, were made by the assembly and processing industries. Japan was a champion in the mass-production industry (Moritani 1981). However, in advanced countries people's values changed as 204 DECLINE AND RENAISSANCE OF THE STEEL TOWN living standards improved and the service economy advanced. It became harder and harder to satisfy consumers' needs and demands with standardized , mass-produced goods. The mass production system had reached a limit, and a flexible production system (producing many kinds of products in small amounts) was sought instead. Furthermore, changes in the market promoted the development of information technology, which changed the business environment. The reigning view of the production system changed from an emphasis on planning to an emphasis on the market. Market-hegemonic production is based on customers' orders, and finished products meet customers' needs. Since the production plan changes according to customers' needs, information must be collected and analyzed. The quantity of information required about services and products inevitably increased, and a new phenomenon, informationalization, sprang up worldwide (elM Study Group 1988). The informationalization of industry promotes the industrialization of information while being supported by it. The industrialization...