Although the

Japanese economy The economy of Japan is a highly developed social market economy, often referred to as an East Asian model. It is the third-largest in the world by nominal GDP and the fourth-largest by purchasing power parity (PPP). It is the world's secon ...

is largely based on private enterprise, it has a number of government-owned (public) corporations, which are more extensive and, in some cases, different in function from what exists in the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territorie ...

History

In 1988 there were ninety-seven public corporations, reduced from 111 in the early 1980s as a result of administrative reforms. Public companies at the national level were normally affiliated with one of the economic ministries, although the extent of direct management and supervision varied. The government divided the national-level corporations into several categories. The first included the main public service and monopoly corporations: Nippon Telegraph and Telephone Public Corporation,

Japanese National Railways The abbreviated JNR or , was the business entity that operated Japan's national railway network from 1949 to 1987. Network Railways As of June 1, 1949, the date of establishment of JNR, it operated of narrow gauge () railways in all 46 pref ...

, and

Japan Tobacco and Salt Public Corporation Japan ( ja, 日本, or , and formally , ''Nihonkoku'') is an island country in East Asia. It is situated in the northwest Pacific Ocean, and is bordered on the west by the Sea of Japan, while extending from the Sea of Okhotsk in the north ...

(now

Japan Tobacco Hepburn: ''Nippon Senbai Kōsha'' , type = 1985-: Public (''kabushiki gaisha'') 1949-1985: Statutory corporation , traded_as = , industry = FoodTobacco , foundation = 1898 (as Imperial Japanese Tobacco Company)1 June 1949 (as Japan Tobacco ...

). However, Nippon Telegraph and Telephone Corporation was privatized in 1985, and the Japanese National Railways in 1987, and Japan Tobacco and Salt Corporation in 1988. The second category included the major development corporations devoted to housing, agriculture, highways, water resources, ports, energy resources, and urban development projects. The Japanese Highway operators were changed into public-owned private corporations in 2005. In 2003,

Japan Post was a Japanese statutory corporation that existed from 2003 to 2007, offering postal and package delivery services, Retail banking, banking services, and life insurance. It's the nation's largest employer, with over 400,000 employees, and run ...

was formed out of the former government-run postal services, but privatization is still pending and a major issue in

Japanese politics Politics of Japan are conducted in a framework of a dominant-party bicameral parliamentary constitutional monarchy, in which the Emperor is the head of state and the Prime Minister is the head of government and the head of the Cabinet, which d ...

. Other categories of corporations included those charged with special government projects, loans and finance, and special types of banking. Local public corporations were involved with utilities. Public corporations benefited the economy in several ways. Some, like Nippon Telegraph and Telephone Corporation before privatization, were important sources of technology development funds or centers around which private industry could cluster. Others provided vital public services that private industry would find impossible to finance. The development banks, particularly the

Japan Development Bank is a Japanese development bank incorporated on 1 October 2008 under the Development Bank of Japan Inc. Law (Law No. 85 of 2007). Current ownership structure of DBJ is solely owned by the Government of Japan through the Minister of Finance A ...

, were sources of long-term investment funds and instrumental in shaping the pattern of industry, especially in the early postwar period. Because public corporations also added revenue to the national budget and were, theoretically, self-financing they required little from the government in the way of financial support. They also provided employment for retired bureaucrats. The reemployment of retired bureaucrats as advisers to these corporations as well as to many private-sector firms was rather common, especially in the late 1960s and early 1970s, under the title

amakudari In politics, a revolving door is a situation in which personnel move between roles as legislators and regulators, on one hand, and members of the industries affected by the legislation and regulation, on the other, analogous to the movement of pe ...

(descent from heaven). The practice was most prevalent in the highly regulated banking, steel, and transportation industries but was also found throughout the Japanese economy.

References

{{DEFAULTSORT:Public corporations Economy of Japan

Japan Japan ( ja, 日本, or , and formally , ''Nihonkoku'') is an island country in East Asia. It is situated in the northwest Pacific Ocean, and is bordered on the west by the Sea of Japan, while extending from the Sea of Okhotsk in the north ...