Cool Japan: the relationships between the state and the cultural industries

Chapter 7: Conclusion

This concluding chapter aims to recapitulate the main findings of this research. Firstly, it examines the theoretical contributions of this doctoral research, stressing the persistency of developmentalism despite neoliberal globalization and the implementation of neoliberal reforms in Japan since the 1980s. Secondly, the main empirical findings are summarized, that is to say the Cool Japan policy, its industrial nature, the reactions of the anime, manga and video games sectors and the confirmation of the sectionalism of the Japanese bureaucracy. Lastly, this conclusion suggests some future areas of research.

7.1 Theoretical contributions

Despite the great transformation of Japanese capitalism (Lechevalier, 2014) and the implementation of neoliberal policies, this work demonstrates the continuation of developmentalism in Japan (Weiss, 2000; Pekkanen, 2003; Wong, 2004). That is, the process of neoliberal globalization does not automatically lead to the demise of the developmental state and the shift towards an Anglo-Saxon minimalist state. Governments continue to maintain some leeway even under globalization. Agency, state capacities, and the ideological background of policy-makers continue to be significant variables that require the attention of scholars.

Furthermore, the end of the period of catching up with the Western economies does not signify that the Japanese developmental state has come to a standstill. Japanese policy-makers continue to conduct and to experiment with industrial policy, as well to look for promising economic sectors to support. The end of the logic of catching up with the Western economies did not signify the retreat of the state. Indeed, a new logic has emerged: the logic of keeping up, in other words a stress on continuously improving the competitiveness of the Japanese industries, and a constant effort to detect new “sunrise” industries (Weiss, 2000: 27-8). Therefore, Japan remains a long way from leaving everything to the market. As long as decision-makers are convinced that the state has a role to play to ensure the competitiveness of the national economy, Japan will refuse to leave everything to the market.

This thesis expands the analysis of the developmental state to a new industry, the cultural industries. As suggested by Pekkanen (2003) and Weiss (2000), this confirms that the developmental state is not limited to the industries Johnson (1982) focused on, such as coal, steel, textile and so on. In addition, this work offers concrete empirical evidence that Cool Japan represents an industrial policy, defined in the Introduction as “any type of intervention or government policy that attempts to improve the business environment or to alter the structure of economic activity toward sectors, technologies or tasks that are expected to offer better prospects for economic growth or societal welfare than would occur in the absence of such intervention” (Warwick, 2013: 16, emphasis in the original).

The METI is the main ministry in charge of implementing Cool Japan (see Chapter 5, Section 5.2.2). By conducting this policy, this ministry hopes to improve the business environment of the cultural industries and supports the dissemination of their products overseas. The METI considers Cool Japan as a way of stimulating the Japanese economy due to the ripple effects expected in terms of growth and jobs creation. Ultimately, the aim is to boost the number of foreign tourists visiting Japan, thereby developing the tourism industry, for example the contents tourism (Seaton and Yamamura, 2015). These elements are consistent with the definition of industrial policy above.

The J-LOP and the Cool Japan Fund were created, respectively in March 2013 and November 2013, to provide financial assistance to the Japanese cultural industries in order to facilitate the exports of their merchandises. Several differences exist between these two organizations. For example, the J-LOP provides subsidies whereas the Cool Japan Fund invests through the buying of shares, that is to say equity investments, in order to become a minority shareholder. Another difference lies in the fact that the J-LOP focuses on the content industries, whilst the Cool Japan Fund has a more encompassing perspective because it helps the sectors of fashion, lifestyle, food, and tourism, in addition to the content industries.

Notwithstanding these differences, the J-LOP and the Cool Japan Fund are both under the supervision of the METI, respectively the Media and Content Industry Division for the former, and the Creative Industries Division for the latter. Nevertheless, the METI does not decide the allocation of the funding as the J-LOP has a committee whose members remain undisclosed. The Cool Japan Fund has also a committee composed of seven members (the chairman, the CEO and five outside board members) to decide which projects to fund. It regularly reports its activities to the Creative Industries Division in a similar way than the J-LOP does with the Media and Content Industry Division.

The J-LOP and the Cool Japan Fund symbolize the persistence of the Japanese developmental state. Indeed, the government decided to create them in order to encourage the development of the Japanese cultural industries in the foreign markets. This demonstrates that bureaucrats still believe that the state has a role to play in the Japanese economy if the market does not meet their expectations, as the interview data demonstrated. They assume that the cultural industries are too domestic-oriented because of the large domestic market. In their opinion, the rapidly aging population and the fall in the number of young people will cause a decrease in the domestic demand. Therefore, it is paramount that these industries expand more overseas.

The existence of a large domestic market is not the only reason that explains why many companies in the sector of the cultural industries, especially the SMEs, miss business opportunities overseas. Indeed, Japanese banks and investors are reluctant to invest in the SMEs because they consider that their projects are not sufficiently reliable. It is why it is very difficult for them to have access to the necessary funds for their expansion abroad. Furthermore, most of the time, they lack the staff knowledgeable about the foreign markets. The Cool Japan Fund was created to resolve these bottlenecks by finding the successful business models, by investing in companies in the form of shares and by developing the skills necessary for their expansion overseas.

The Cool Japan Fund testifies that the Japanese developmental state acts as a catalytic agent which gives incentives and disincentives (Lind, 1992). In this case, the Japanese developmental state sends the message that the Japanese cultural industries have to develop more their business abroad, and that the banks and investors have to be more willing to invest in them. Yet, the Cool Japan Fund does not represent public risk absorption (Weiss, 1995: 609), unlike the JAROL for the robot industry (Mansfield, 1989: 190) and the JECC for the computer one (Anchordoguy, 2005: 131). Indeed, the Cool Japan Fund is a minority investor in the selected projects. This change, from taking the biggest share of the risk of investments to being a minority shareholder, probably reflects the present difficult situation of the developmental state’s budget and the impact of neoliberalism.

In contrast to authors who claim that a pilot agency is one characteristic of the developmental state (Johnson, 1982: 319-20; Weiss, 2000: 23; Hayashi, 2010: 50), this doctoral project did not use this notion of a pilot agency as the government did not support the manga publishers, anime studios and video games companies when they began to export their products. This notion seems more relevant for nascent industries than for those which developed outside of a state framework.