Japan vs. US economy

The primary purpose of the economic activity is to benefit consumer while maximizing wealth creation; while the distribution of that wealth is of secondary importance. 1. U.S economy is approaching Neoclassical model in which individuals are assumed to maximize their own private interest, and business enterprise are expected to maximize profits which result in a powerful proconsumption bias and insensitivity to the social welfare impact of economic activities. - market are competitive and competition should …

…the government selected and protect a small number of powerful firms from domestic and foreign competition by giving tax credits and subsidy which allow them to develop rapidly. Not only that the government also support technological development and other means. Once the technology was fully develop, gov. fully encourage domestic competition to improve the firm’s efficiency. They believe that the government intervention will eventually enable Japanese firms to close the technological gap with American.