Practical steps for interactive inventions

Interactive inventions are practised in many Japanese firms. They are based on an epistemology of interconnectedness and individual convertibility. The feasibility and practical steps for interactive inventions in other cullures are discussed.     

Hierarchists,individualists and mutualists: Three paradigms among planners

In planning which involves many disciplines, the failure to communicate often impedes progress from the outset. In this article the author exposes the fundamental cause of this failure : people use diverse paradigms without realising it and are often unwilling or unable to apply different kinds of logic to a problem. Three broad categories of paradigm are analysed: one-way causal, random process and mutual causal. The author illustrates that a situation has apparently contradictory implications according to the system of logic used.     

Retail power market competition with endogenous entry decision—An auction data analysis

Deregulation in the electric power industry has been aimed at promoting competition and thereby enhancing the industry’s efficiency. We use the auction data of public power procurements to study the impact of the reform on the retail power market in Japan. We quantify this impact by measuring a decline in power charges, controlling for the endogeneity bias caused by the entrants’ bid-submission decisions. Our results suggest that power charges would decline by about 0.48 yen/kW h on average when two or more providers bid at an auction.     

Japanese management theories and Japanese criticisms

Criticisms of theories of Japanese management abound in Japan but are little known or available in the west. The author highlights some of the prevailing discussions on various employment and organizational practices and, through a cultural history of the Japanese people, illustrates how it should not be assumed that management practices are directly transferable to the west.     

Numerical Approach to Asset Pricing Models with Stochastic Differential Utility

In this paper employing two heuristic numerical schemes, we study the asset pricing models with stochastic differential utility (SDU), which is formulated by either of backward stochastic differential equations (BSDEs) or forward-backward stochastic differential equations (FBSDEs).The first scheme is based upon a traditional lattice algorithm of option pricing theories, involving the discretization scheme of coupled FBSDEs, which is combined with a technique of solving numerically a certain type of nonlinear equations with respect to the backward state variables. The second one is based upon the four step scheme of Ma et al. (1994) which solves quasi-linear partial differential equations associated with the FBSDEs. We demonstrate that our practical implementation algorithms can successfully solve the asset pricing models with generalized SDU and the large investor problem with market impact which are typical examples such that the usual four step scheme is difficult to implement. As other numerical applications we study the optimal consumption and investment policies of a representative agent with SDU, and the recoverability of preferences and beliefs from observed consumption data.     

New management dimensions in international business

Changing international business management situations generate new practices, methods, and concepts which are not sufficiently dealt with in management theories and training materials. This article highlights some of them with concrete examples.     

Incorporating emotion into social exchange: considering distinct resident groups’ attitudes towards ethnic neighborhood tourism in Osaka,Japan

While numerous studies have utilized SET to examine the residents’ attitudes towards tourism, relatively scant from the literature is a discussion regarding the influence of emotion generated through SET among residents on their attitudes towards tourism. In addition, past studies mainly explored the social exchange between visitors and locals, while neglecting the social exchange within a local community. The goal of this study is to examine the influence individuals’ emotions toward their ethnic counterparts within a community can have on residents’ (i.e., members of the dominant ethnic group—Japanese and members of the ethnic minority group—Koreans) attitudes toward ethnic neighborhood tourism within the Korean neighborhood of Ikuno, Osaka, Japan. Ikuno has the highest concentration of Korean residents in Japan, and the town has become a destination of cultural tourism centered on Korean culture. Analysis of 640 completed questionnaires revealed while attitudes of Korean residents, who are more likely to perceive economic benefits from tourism have more favorable attitudes towards tourism, Japanese residents form their particular attitudes towards tourism based on the emotional solidarity they experience with their Korean neighbors. These findings indicate both utility of economic approach of social exchange theory and significant role of emotion in social exchange.     

SOCIALLY OPTIMAL SUBSIDIES FOR ENTRY: THE CASE OF MEDICARE PAYMENTS TO HMOs*

The U.S. Medicare program has increased its spending on private Medicare plans in anticipation of larger consumer surplus and higher efficiency. To evaluate the welfare consequences of such policy interventions, I develop an empirical model with endogenous entry. Counterfactual simulation reveals the following: subsidizing HMO entry can be justified to enhance national welfare (no excessive entry); the level of price subsidies in 2008, however, is far beyond the optimal level; and the geographic inconsistency between the subsidies and the Medicare fee‐for‐service costs is another source of inefficiency. Resolving this geographic inconsistency significantly raises national welfare by restructuring entry.     

Japanese manufacturing facing post-Fukushima power crisis: a dynamic computable general equilibrium analysis with foreign direct investment

The Great East Japan Earthquake and the subsequent tsunami that hit and severely damaged the Fukushima Daiichi Nuclear Power Station resulted indirectly in the shutdown of most of the nuclear power plants in Japan. To compensate for the lost nuclear power supply, more fossil fuels were used. People became concerned that this could be disadvantageous for domestic manufacturing industries and accelerated their offshoring to Asia, especially China, through foreign direct investment (FDI). We used a world trade computable general equilibrium (CGE) model with endogenous FDI from Japan to China to quantify the impact of the power crisis on the Japanese manufacturing sectors. We found that the power crisis as well as FDI would adversely affect several sectors that use power intensively, but would benefit the transportation equipment (TEQ), electric equipment (EEQ) and machinery sectors, despite the common expectation that these sectors would undergo a so-called ‘hollowing-out.’