The Trajectory of the Statist Model: France and Japan Compared

The statist model, along with the corporatist and liberal ideal-types, has long figured prominently in discussions of the different forms that market economies can take. Yet the crisis and poor performance of many countries associated with the statist model over the past twenty years has called this approach into question. This paper explores the evolution of both the thinking and functioning of the statist model, primarily through a comparison of France and Japan. It analyzes the factors that promoted the emergence of statist political economies, their mode of operation, and the reasons why they entered into crisis. It pays particular attention to the differential responses to crisis in France and Japan. French elites shifted economic policy in a sharply neo-liberal direction, while expanding social and labor market policy to pacify and demobilize the victims of market-driven restructuring. Japanese authorities, by contrast, proceeded more cautiously and incrementally, introducing flexibility and a lighter regulatory touch into the Japanese system, while seeking to preserve its core strengths, such as worker loyalty and close supplier relations. Whereas the French approach has combined far-reaching neo-liberal reform with expensive new social commitments, the Japanese response has mixed incremental reforms with no less expensive commitments to the preservation of jobs and embattled companies. The paper analyzes the respective strengths and weaknesses of the French and Japanese reform trajectories. It concludes by considering possible future changes as well as the implications of the French and Japanese experiences for both the theory and practice of state-led economic development.