UC Berkeley

This dissertation examines the consequences of globalization and trade liberalization for government-business relations in advanced industrial economies. How do the early stages of trade liberalization affect the opportunities for multinational firms to influence the policies of a target country? What factors explain the varying patterns of corporate political activity that we see across different sectors in an economy? In order to answer these questions, I conduct a cross-sectoral analysis of Japan, a country that has historically been notoriously closed to foreign business and investment. Drawing on archival material, market data, newspaper articles, direct observation, and interviews, I examine the influence of foreign firms on the Japanese policymaking process from the immediate post-World War II period to the present. In particular, I focus on case studies of four sectors in which distinctly different patterns of corporate political activity manifest: agriculture, pharmaceuticals, insurance, and information and communications technology.

I find that while foreign firms were initially dependent on their home governments to influence Japanese policy, opportunities for these firms to employee political strategies both independently and in coalition with Japanese partners have increased with the opening of the Japanese economy and society. Furthermore, the manner in which the Japanese market opened has had important consequences for politics; the pattern of internationalization in each sector has shaped foreign firms’ political strategies by defining the scope of potential coalitions and tactics available. In sectors such as agriculture where internationalization in Japan has been minimal, foreign actors’ political strategies remain focused on lobbying their respective home governments, which continue to be the primary conduit for private sector demands. However, in other more internationalized sectors, understanding the precise mix of political strategies used by foreign firms requires investigating the cleavages that internationalization creates in both the home and target countries. In some cases, these cleavages favor the formation of cross-national coalitions, alliances between Japanese and foreign actors who consciously coordinate strategies and pool resources in pursuit of mutual aims. When Japanese actors are divided, foreign firms may be able to form cross-national coalitions and increase their political influence. However, divisions among foreign firms may also complicate the policymaking process, resulting in competing cross-national coalitions or in situations in which foreign firms who have achieved market success in Japan try to shut out all new market entrants, both foreign and Japanese alike.