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Industrial, Science, Technology and Innovation Policies in South Korea and Japan

Murat A. Yülek and Hongyul Han

Designing effective industrial and science, technology and innovation (STI) policies is still an ongoing quest for both developed and developing countries. This book examines industrial as well as STI policies in East Asian countries South Korea and Japan comparatively. Japan is one of the largest industrial economies in the world. However, it is experiencing competitiveness problems with a relative fall in its manufacturing industry indicators such as exports. Korea is, on the other hand, a rapidly rising industrial power challenging larger peers including Japan. The two economies are competing in similar markets and are on different cycles of development. This book looks at the competitive positions of the two countries in the field of industrial and STI policies in general and in the sectors of railway equipment, medical equipment, aviation equipment and electronics.

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Chapter 10: STI and Industrial Policies in Japan: Railway Equipment


10.1 Industry Overview

The introduction of railway system in 1872 was regarded as the first step of Japanese modernization. It was not until 1893 that Japan first constructed locomotives. The main route from Tokyo to Osaka-Kobe via Nagoya was built and operated by the government, but other national routes were built as private railways. Most of the private railways were nationalized to form the Japan National Railway in 1906. Since then, national railways saw continuous expansion until their privatization in 1987. During World War II, the railways shifted from passenger service to that of freight, which returned to passenger service in 1945.41

In the 1950s, the post-war economic recovery and development generated large demand for both passenger and freight transport. In order to meet this growing transport demand, construction on a high speed railway route from Tokyo to Osaka, the Hokkaido Shinkansen, started in 1959 and was completed in 1964. The days of steam locomotives and old narrow gauge lines ended with the introduction of electric power locomotives in the 1960s. Today’s railway system in Japan is predominantly electrically powered for both commuter trains and city to city freight and passenger operations. Entering the 1970s, Japan’s railway transportation started to give way to road and airway transportation and suffered from huge chronic deficits. The development of the Shinkansen network was a key part of the 1969 Second Comprehensive National Development Plan, which led to the promulgation of the Nationwide Shinkansen Railway Development Law in...

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