Japan’s self-inflicted decline

JAPAN should be doing well. It boasts a well-educated and disciplined workforce, and outdoes most other industrialised countries on both investment and spending on research and development (R&D).

In fact, at 3.3 per cent of gross domestic product (GDP), the country’s R&D expenditure was higher than the US until recently. And yet, Japan’s relative decline continues.

In the 1980s and 1990s, Japan was the world’s second-largest economy, not least because of its seemingly unbeatable industrial sector.