長期不況의 政治經濟: 1990年代 日本을 中心으로

The Political Economy of the "Lost Decade": The Case of Japan in the 1990s

The major argument of this essay is that the information difference among the banks, the Banking Bureau of the Ministry of Finance(MOF), and politicians seriously delayed the implementation of effective countermeasures against the crisis of the insolvent bond and thereby resulted in contradictory policies in Japan in the 1990s. It is commonsensical that for a variety of reasons the government often delays making a political decision on the investment of the public fund to cope with the bank crisis. More often than not, despite the failure of the initial countermeasures, the bank crisis is solved when the economy recovers. In the case of Japan, similarly, the countermeasures by the unofficial networks centered on the MOF had previously been exercised. After the 1990s, however, the unofficial networks functioned improperly, and subsequently the Jananese government failed to create a new system to overcome the financial crisis. In retrospect, a new institutional device to share the cost of the bankruptcy should have been prepared in the 1980s when the MOF's unofficial networks began to show their limits. In the early 1990s the profits of the relief-merger bank decreased to the level less than the one in the previous period; therefore, the merger system by the convoy fleet system already lost its effect. At a minimum, a new institution should have been created in 1994-95 when a series of bankruptcy cases transpired. For instance, investment of the public fund on Chosen in 1995 could have some effects on managing the bank crisis. It did not, mainly because strong criticisms from diverse quarters. The MOF was criticized by the press and by the politicians when it asked the Japanese Diet for the investment of public fund. As a result, the Banking Bureau tried to conceal the information on the efficiency of the traditional way of the bank relief rather than creating a new institutional system. When Hyogo Bank wen bankrupt in 1995, several major political figures began to recognize the fact that the local banks were in a serious financial situation. However, due to the MOF's traditional method of solving the financial crisis by operating the unofficial networks, the general financial information was not properly delivered to the politicians. It can be said that the Liberal Democratic Party's traditional profit-conscious political tendency aggrevated this essentially political problem. The politicians recognized that a public consensus was necessary to invest the public fund to handle the bankruptcy. Otherwise, they would not expect a good result in the elections. For all those reasons, the politicians tried to save time by taking politically less sensitive measures on bankruptcy.