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Japan Must Let Zombie Companies Die

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Re: Japan Must Let Zombie Companies Die

#41

Post by captaindiego »

arohner wrote: post #26
patio11 wrote: post #19

Meanwhile, you manage to secure venture-capital funding and even a bank loan. The interest rate is high, but with your rapid growth, you should be able to pay it back. Meanwhile, in the Japan some of us actually live in: 1) Very few 26 year olds will be successfully able to convince their 26 year old co-workers to leave Sharp, because that is a once-in-a-lifetime mistake. I am literally related to a $ANONYMOUS_FOR_SA…

Why is a business checking account so difficult? Seems like "I have $1000 (or 10k) to place in my shiny new account" would be enough to mollify them?

Even getting a basic credit card in Japan as a foreigner can be a real pain. If you work for a big company and can get some oomph behind your application you're fine. But if you're a foreign student you're probably going to have trouble.

Re: Japan Must Let Zombie Companies Die

#42

Post by cturner »

jljljl wrote: post #33
duncan_bayne wrote: post #17

Earlier quoted context omitted.

I think the author was criticising malinvestment, rather than arguing for higher productivity. https://en.wikipedia.org/wiki/Malinvestment According to the Austrian school, market interventions like those in Japan are bad _regardless_ of the effect on productivity, because they represent malinvestment.

How exactly do you judge a malinvestment if you don't measure its effects?

So the issue is - is it possible to produce a valid measurement? In scientific method, part of an experiment involves a control. There's no way to produce one in economics - the systems are too complicated. You can't know whether measurements you take are the result of your change directly, or caused by network effects of the change as part of other things going on, or just weather from unrelated things happening in the economic system.

Austrian instincts are partly about building a defense against corruption and tyranny. If you let politicians spend money or introduce mechanisms that are difficult to measure, or which can be easily hand-waved away ("we did what we thought was right based on the information at the time"), then they are incentivised to spend. Instead, they form a line in the sand and say that you're not allowed to do anything which can't be clearly justified from a set of first principles. The back-story is not so much a faith in the inherent goodness of markets as in the inherent evilness of governments.

Re: Japan Must Let Zombie Companies Die

#43

Post by [deleted] »

jljljl wrote: post #28
orangecat wrote: post #13

Earlier quoted context omitted.

If the goal of Japanese policy makers is to boost demand, and that does seem like a wise goal, then keeping 50,000 workers employed at Sharp seems like a smart bet, compared to keeping 100 people employed at some nimble, fast-moving startup. If you want to make sure people have money so that demand is increased then just give them money, don't keep useless jobs around. the USA was able to sell its stake in GM at a pr…

USA didn't sell at a profit. But the loss was $10.5B to save (according to the article) 1.2M jobs, and saved $34.5B in tax losses. Even if you ignore the saved tax income, thats less than $9,000 per job saved. So the bailout was probably _still_ a net positive for the US.

[deleted]

Re: Japan Must Let Zombie Companies Die

#44

Post by eropple »

gozur88 wrote: post #36
jzelinskie wrote: post #5

>you decide to leave your job and start a business with your college buddies I know the point they were trying to make in the article, but the primary reason this doesn't happen in Japan is the cultural fear of failure rather than the system being broken. Once you're in, the nanny corporation will take care of you for the rest of your life. Once those corporations are in, the government will take care of them for the…

>Once you're in, the nanny corporation will take care of you for the rest of your life. The flip side of that is if you quit you will never be offered another salaryman job. By anyone. I wouldn't start a business in Japan unless I was already unemployed.

Is this really true? (I have no idea, it just sounds so implausible that I feel like I have to ask.) Is there any good reading on this topic?

Re: Japan Must Let Zombie Companies Die

#45

Post by gozur88 »

primrosepath wrote: post #11

> The U.S. auto bailouts were undertaken in the middle of a deep recession, and are highly unlikely to be repeated. Except Chrysler was bailed out before and has now been merged/bought by a foreign auto company for the second time in 20 years.

I had to laugh at that, too. US auto companies will be bailed out or forced into mergers exactly as often as they fail. The government can't afford to assume pension obligations for all those retirees.

Re: Japan Must Let Zombie Companies Die

#46

Post by jljljl »

cturner wrote: post #42
jljljl wrote: post #33

Earlier quoted context omitted.

How exactly do you judge a malinvestment if you don't measure its effects?

So the issue is - is it possible to produce a valid measurement? In scientific method, part of an experiment involves a control. There's no way to produce one in economics - the systems are too complicated. You can't know whether measurements you take are the result of your change directly, or caused by network effects of the change as part of other things going on, or just weather from unrelated things happening in…

I'm not sure if the response to difficulties in measurement is to build a system out of faith and assumptions.

We can analyze different policy decisions, either by modeling human behavior (based on experiments which can be controlled and analyzed), or through natural experiments (e.g., What happens when a bunch of states and municipalities alter their minimum wage policies?)

Re: Japan Must Let Zombie Companies Die

#47

Post by free2rhyme214 »

I was in Tokyo in 2013 and 2014. I remember seeing lots of salarymen all dressed the same, also government workers all dressed the same with their little badges on their sleeves and I couldn't help thinking about the lack of individuality in their culture.

It doesn't surprise me that Japan is mimicking the U.S. by bailing out failing local companies.

The real issue with Japan is their lack of entrepreneurship. They used to be fierce competitors but are now more of an afterthought.

Re: Japan Must Let Zombie Companies Die

#48

Post by pkaye »

eropple wrote: post #44
gozur88 wrote: post #36

Earlier quoted context omitted.

>Once you're in, the nanny corporation will take care of you for the rest of your life. The flip side of that is if you quit you will never be offered another salaryman job. By anyone. I wouldn't start a business in Japan unless I was already unemployed.

Is this really true? (I have no idea, it just sounds so implausible that I feel like I have to ask.) Is there any good reading on this topic?

This one is a good read: http://www.kalzumeus.com/2014/11/07/doing-business-in-japan/

Re: Japan Must Let Zombie Companies Die

#49

Post by [deleted] »

eropple wrote: post #44
gozur88 wrote: post #36

Earlier quoted context omitted.

>Once you're in, the nanny corporation will take care of you for the rest of your life. The flip side of that is if you quit you will never be offered another salaryman job. By anyone. I wouldn't start a business in Japan unless I was already unemployed.

Is this really true? (I have no idea, it just sounds so implausible that I feel like I have to ask.) Is there any good reading on this topic?

[deleted]

Re: Japan Must Let Zombie Companies Die

#50

Post by [deleted] »

primrosepath wrote: post #18
raddad wrote: post #16

Earlier quoted context omitted.

China owns GM. http://qz.com/594984/the-secret-history-of-gms-chinese-bailo... ;

Even more scary for Detroit, once the American public figures out Tesla is actually more American made than the big 3 they will feel no guilt in buying Teslas instead. This is especially the case if we start losing a bunch of coastal areas and the big 3 look apathetic about their role in global climate change.

[deleted]
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