Regulatory Reform in Japan

Abstract

Japanese governments have been actively engaged in regulatory reform since the Koizumi Cabinet in the early 2000s. They held a common expectation that the regulatory reform, as a key element of structural reform, would enhance the corporate sector’s investment and infuse more competitive ingredients into their rigid market structure, and by doing so enable them to escape from the long-lasting economic recession. In a similar vein, the Abe Cabinet announced the promotion of regulatory reform as part of its growth strategy, in June 2013. This research, in the first place, examines the theoretical background and significance of the mitigation of social regulations conducted by the Koizumi Cabinet in the early and mid-2000s, and then address why the Abe Cabinet's growth strategy stresses the mitigation of social regulations and launched regional- and firm-level regulatory reform alongside conventional measures. Based on this framework, we follow up on the progress made in these three types of regulatory reform, to evaluate the Abenomics growth strategy.