| Abstract: | This paper examines Japan's national innovation system thatwas so successful in the 1980s and seems to have lost its competitivenessin the 1990s. In recent years, the competitiveness of industryrelies not only on industry itself but more and more on thenational innovation system as a whole. The first section ofthe paper points out that Japan's potential economic growthrate is likely to decline in the twenty-first century, primarilybecause of the rapidly ageing population, and, therefore, itis important to increase productivity through technologicalprogress. Then, in the following sections, each sector of Japan'snational innovation system, namely industry, universities, andgovernment, is examined and directions of reform are suggested. |
