About the Interview
What happens to Main Street when Wall Street fails? Japan expert David Weinstein squeezes a unique data set to answer this question. While in the US you will find data on banks and data on firms separately, in Japan there's data that links banks and firms -- a great opportunity to analyze the damage done by collapsing financial institutions. David Weinstein investigates the Japanese financial crisis during the 1990s to shed light on the US financial crisis today. This is research about Wall Street shaking Main Street -- this is new economic thinking.
About David Weinstein
David E. Weinstein is Carl S. Shoup Professor of the Japanese Economy. His teaching and research interests include international economics, macroeconomics, corporate finance, the Japanese economy, and industrial policy. Full profile
Comments
David, very interesting, esp. in your context of what economics really is. But the nagging question remains re the Japan-US/West comparison. And that question, at least in my mind, is: is it not that Japan's two lost decades are mainly caused by over-investment and/or mis-investment rather than the over-consumption (e.g. as in the US case)? The Japanese society is so much more centralistic (socialist, if you will) than the USA; so Japan can go wrong on investment much further than the US can go wrong on consumption, before the intrinsic systemic correction mechanisms kick in (and the course is changed). So the comparison to China's current investment drive, also quite centralistically driven, is probably more fruitful. Another diverging factor is of course demography: US growing, Japan shrinking, etc. Is it not that we sometimes go too far in drawing conclusions (e.g. Japanisation thesis) from this current Japan-US predicament comparison?
Best wishes from hot Toronto!
Val Samonis
Love this interview! So much enthusiasm :)
Thanks INET
This is a real teaser. What is the difference between those companies that had relationships with failed banks and what happened to the companies that had relationship with non failing banks? Does he have any idea of what happens?
Definitely my favorite "30 Ways..." yet (as an economics undergrad). Not only was Prof. Weinstein's research question (and implications thereof) so intriguing but also his wonderful discussion of the discipline. I would love to read his thoughts on how exactly the culture, institutional structures, etc. of Japan feed into their responses to business cycle phenomena. Also, I love when an economist is extremely articulate (and hate it when they're not).
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