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Knowledge Co-Creation - Profiles of researchers

Japanese Economics and their Contributions to the International Forum
-An Assessment from the Perspective of the History of Economics-

Professor Aiko Ikeo
Waseda University Faculty of Commerce

Responding to the desire to know

Within the area of economics, my specialty is "the history of economics", which is a field that researches the history of economics itself. With a focus on Japanese economists and economic research, I conduct historical research from a perspective that includes the internationalization of such areas. In Japan, economists such as Mr. Michio Morishima, Mr. Hirofumi Uzawa and Mr. Takashi Negishi have contributed to the post-WWII economics, and the original theories of such economists have been the subject of attention throughout the world. In recent years, among American and European researchers, there has been resurgence in the desire to know more about the research and background of such Japanese economists.

Approximately 20 years ago, I had the opportunity to serve as a visiting scholar at Duke University in the USA. At that time, Professor Roy Weintraub, who was kind enough to send me an invitation letter, developed a great interest in the general equilibrium theory of Mr. Takashi Negishi. Professor Weintraub has a background in mathematics and been famous for his research regarding the history of mathematical economics. Professor Weintraub made a deep impression upon me when he said that "In Japan, there is a lineage of modern economics that comes from pre-WWII economists such as Mr. Takuma Yasui. This served as basis for the development of theories by economists such as Mr. Negishi after the war. I understand this much. However, I cannot attempt to delve deeper into the subject, because there is not enough information available in English."

Before my very eyes, a first-class American researcher had expressed his desire to know more about Japanese economics. I thought to myself that I must make such information available, and the experience was a major impetus for my decision to specialize in the history of economics with focus on Japanese contributions.

Recently, in April 2009, I published a book entitled "A History of Economic Theory: Essays in Honour of Takashi Negishi" (co-edited with Heinz Kurz, University of Graz, Austria) from an academic publishing company (Routledge) in London. The book is a commemorative collection of essays that is dedicated to Takashi Negishi. In this book, I wrote an essay regarding Mr. Negishi's contributions to trade theory. The book was based upon essays that were originally composed and most of them had been presented in the session in honour of Takashi Negishi in order to commemorate his 70th birthday at the annual meeting of the History of Economics Society in Toronto, Canada in 2004, one year behind his birth year.

I consider it a great honor that such a commemorative session was held with participation from various countries who were influenced by Mr. Takashi Negishi. I also consider it a great honor to have been personally involved as an editor and author. Several years were required to collect the material for the book because the specialties of the researchers involved were extremely diverse and I struggled to make the essays into a single volume.

An international conference of the IEA (International Economics Association) held in Gamagori, Japan in 1960. The group photograph shows the faces of many prominent economists such as Ichiro Nakayama, Seiichi Tobata, Kenjiro Ara, E.A.G. Robinson and T.W. Swan. Kaname Akamatsu, P.S. Lokanathan and a young Amartya Sen also participated in the conference. This kind of photograph from a past conference is also valuable research material in the history of economics. (Photograph provided by Mr. Ichiro Hotta, Secretariat of the IEA Gamagori Roundtable Conference.)

"Internationalization of economics" is an important perspective

My book "Economics in Japan-The History of Internationalization of Economics in the 20th Century" reflects the research results that were performed in the 1990s and focused on the internationalization of economics in Japan. It was published in 2006.

Another important research theme is the perspective of the "internationalization of economics". After WWII, through international economic aid to various countries and regions from the victorious country of the USA, and then through economic cooperation with developing countries from Europe and the USA, there was the aspect of expansion in the activities of international institutions such as the United Nations (UN). Economists from various countries develop an interest in international currency and financial policies, and economic officials and economists are cultivated. Such individuals then began to implement development policy and international finance. Within this kind of movement, economics itself undergoes internationalization. The establishment of the European Union (EU) shows one symbolic example. Currently, the EU and the euro sphere compose a single domestic economy.

In 1994, an international joint research project named "The Internationalization of Economics since 1945" was organized by A.W. Coats (Duke University). Members from 10 countries participated in the project and conducted an international comparison. This project was extremely informative thanks to participation from the International Monetary Fund (IMF) and the World Bank. There were many opportunities to learn together with experienced international economic officials. For me personally, the participation in an international conference with such a refined theme has been a most enjoyable and stimulating time. The constructive discussion between highly experienced specialists who had gathered from various countries served to spur creativity.

A photograph from the international conference "Robert Solow and the Development of Growth Economics" (April 2008; Professor Ikeo is 3rd from the right). The conference was organized by K.D. Hoover (Duke University) and M. Boianovsky (University of Brasilia, Brasil). In addition to participation by Solow himself, there was participation from researchers in fields such as economics, economic history, the history of economics and methodology, as well as former economists of international institutions and a journalist. Participants came from a total of 9 different countries. The photograph was provided by P. Garcia Duarte (University of Sao Paulo, Brasil).

In the future, it is predicted that this type of phenomenon will increase in the East Asian region. How fast will internationalization proceed? To what extent will economic community development expand? Economic internationalization will proceed steadily. Economists from various countries will cooperate to become involved in public policies, and the economic internationalization of East Asia will proceed of itself in the middle of such movement. Personally, I hope to firmly assess the growth of internationalization while maintaining a perspective that focuses on Japan.

A biography that can be read by a high school student

"Kaname Akamatsu-Surpass My System" (Biography, Japanese Economic Thought Series, 2008)

I also wrote a book entitled "Kaname Akamatsu- Surpass My System", which is the biography of an economist. Mr. Kaname Akamatsu was the most prominent individual active in international economics both before and after WWII. He is known for espousing an economic theory called the "flying-geese theory" in the early part of the Showa Period. The theory proposes that during the economic development of a country there are a series of stages that begins with importing, continues with domestic production through imitation (import substitution) and then finally leads to exporting. This series of stages is compared to the sight of a flock of geese flying to one location after another. This theory is well known in Europe and America.

The book follows the upbringing and work of Akamatsu in chronological order, and the background of his research is composed of a variety of historical facts and poems that he wrote. The book also contains episodes other than his research activities. For example, in the 1920s, he conducted overseas research in Germany and then visited the Business School at Harvard University on his return trip to Japan. The book discusses the shock that he received when attending a unique lecture that used the "case method" at the school. The case method, which had just started at the time, is an instructional method that is currently used in business schools throughout the world.

This biography is one volume of a series entitled "Critical Biography: Japanese Economic Thought". The book was written as simply as possible with the goal of making it readable for high school students and college students. In fact, my own father read it, which is quite a rarity! Even so, scholarly gathering of information and surveys were used when creating the book. I visited former students of Akamatsu and held discussions with them.

I considered using the contents of this book to write a short English essay, and I investigated the historical research libraries of Harvard Business School. However, I reaffirmed that WWII has become the last war since the defeat for Akamatsu and for the Japanese while it is not so for Americans. As a result, I have postponed my writing of an English essay.

In addition to Akamatsu, many instances can be seen in which Japanese economists made international contributions to the theory of international trade. There was quite a large amount of joint research performed with Australian economists. However, since the majority of their research contained theories based on the assumption of a small economy, the research did not receive much attention in the extremely large country like the USA. Also, even in Asian economic research, there was a difference in the research perspective of Europe and America and of Japan.

I hope to contribute to financial system reform

Until July 2009, I once again visited Duke University in the USA for slightly more than 1 year of overseas research. My initial objective was historical research in international economics. I also started a survey of new material passed on by Martin Bronfenbrenner, an American economist who conducted research on Japanese economics. Beginning with his first visit to Japan in 1945, Bronfenbrenner visited Japan many times and researched Japanese economics. Since his death in 1997, valuable material that had been collected in Japan by Bronfenbrenner was donated to Duke University. This material included collections of memorial essays by Japanese economists and other items that cannot be obtained even by us Japanese. Such material is stored in the special collections library of Duke University and is accessible by researchers.

When conveying the history of Japanese economics to the world, I did not use a Japanese perspective. However, I am now trying to skillfully use the perspective of Japanese economics as seen by an American like Bronfenbrenner. By doing so, I believe that it is possible to present the history of Japanese economics in a way that is easy to understand for Europeans and Americans. In the future, I hope to conduct interviews with related individuals in Japan and to summarize my findings into a substantial research thesis.

As for my expectations, I was concerned about the subprime loan issue before visiting the USA, and I focused on what measures would be taken to resolve the issue. Action was taken by the US Congress around the time of the Toyako Summit in July 2008. However, further action came too late, and a financial crisis resulted after the Lehman Brothers collapsed in September ("the Lehman Shock"). Bailouts were conducted towards other financial institutions. At the requests of members of a think-tank, I contributed my postings on the direction of measures being taken in the USA to a public policy bulletin board.

During the middle of WWII, the creation of a future international monetary system was discussed in the USA and at least since then American economists have actively participated in the formation of public policy. Also, many farsighted American economists have always anticipated future financial policy and financial business, and have advanced a type of economic reform in which the USA always makes the first move. Opinions on policy are given not only by scholars but also by outstanding businesspeople that possess a wealth of experience in the financial industry. Furthermore, such businesspeople become Secretary Treasurers. In the USA, financial business and economic theory have been combined and derivatives trading has made great leap forward. As part of this situation, new laws have been enacted and legalization has been performed, and what is known as the "financial revolution" has been advanced faster than anywhere in the world.

In the 1990s, there was heightened interest in Europe and America regarding Japanese economics. "Japanese Economics and Economists since 1945-The Postwar Research Environment and Formation of Public Policy" (1999, edited by Aiko Ikeo), a work co-authored by Japanese researchers, was translated into English in 2000 and published by British publisher Routledge.

Economic policies, financial policies, business practice, financial practice, economic theory, financial theory.new financial and economic systems have been born when all of these elements are seamlessly combined and specialists are watching over the process. Free (Unregulated) financial activities have expanded economic opportunities (loans, business), but a serious financial crisis has occurred and been followed by a serious economic depression. There are some voices calling for regulation. However, matters will not proceed smoothly once debate begins regarding what kind of regulations should be enforced, and proposals from overseas will most likely be required. In retrospect, the shift of the key currency from British pound sterling to the US dollar was the result of research and effort by Americans. The time has come for Japan to improve its research ability and to convey advice regarding policy proposals. In order to solve this serious issue, I believe that contributions must also be made from the perspective of the history of economics.

Professor Aiko Ikeo
Waseda University Faculty of Commerce

Completed the Doctoral Program at Graduate School of Economics, Hitotsubashi University. Holds a Doctoral Degree in Commerce. Assumed her current position in 2000 after serving at the Department of Economics and the Institute for Japanese Culture and Classics, both at Kokugakuin University. Has served as a Senior Research Fellow at the Center for the History of Political Economy, Duke University, and as a Visiting Scholar at the Department of Economics, the University of Tokyo. Her specialty is the history of economics since the 20th century. Her written works include "The Network of Economists in the 20th Century-The Development of Economics as seen from Japan", "Economics in Japan-The History of Internationalization of Economics in the 20th Century", and "Kaname Akamatsu-Surpass My System", as well as numerous research articles and works that she has co-written and edited.

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