There's something very familiar about Shinzo Abe's plans for reviving the Japanese economy. For decades, the government could rely on Japan's biggest companies to serve the national good. Bureaucrats and executives worked hand-in-hand to promote key sectors. In the 1980s, with state help and guidance, Japanese corporations scoured the globe for market share, pouring the spoils back into the economy at home.
Now, Abe seems to expect Japan Inc. to follow a similar script. By driving down the yen 30 percent with an ultraloose monetary policy — the so-called first arrow of "Abenomics" — and greasing the economy with huge fiscal stimulus, the prime minister has boosted the stock market and filled corporate coffers. Executives were meant to return the favor by hiking wages and boosting capital investments.
Twenty years ago, that strategy might have worked. But something new is at play. Japan's corporate champions aren't playing ball — in part because they're no longer very Japanese.