Trading With Japan: What A Difference Three Decades Make

Sometimes, news events seem to resonate with symbolism. Take the hoopla attending the recent opening of a Toys TR' Us store in Japan. Older Americans remember when cheap toys were Japan's best-known export to the U.S.

Similar ironies attend the current drive to boost U.S. car exports to Japan. Back in 1960, the U.S. was first among nations in domestic car output and Japan a distant eighth. By 1990, Japan was first and the U.S. second. But "the actual role reversal was far greater," notes economist David Littman of Detroit's Manufacturers Bank. In 1960, Japan produced just 1.3% of the world's cars and the U.S. made more than 52%. By 1990, Japan's share had soared to 28%, while the U.S. share had shrunk some two-thirds to 17.1%. Cars, of course, are worth more than toys.

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