Chinese Macroeconomic Reforms and the Japanese Model: Implications for Japanese Companies

In 1992 China’s macroeconomic reforms, initiated in 1978, were intensified. Such reforms have been designed to hasten the transition to a market economy and provide an attractive environment for foreign investment China is the world’s fastest-growing economy and that rapid growth is often attributed to an authoritarian political tradition and a social cohesion born of Confucianism which China shares with such successful modernizers as the so-called ‘four dragons’ or ‘tigers’ of Taiwan, Hong Kong, Singapore and South Korea as well as, more importantly, Japan. Given richer natural resource endowments and a larger population, China will pursue a developmental path necessarily different, even though the Chinese leaders are targeting elements of Japan’s economic experience as worthy of emulation.