"The grass is always greener on the other side of the fence."

The present state is all -- the answer. I can say, "American glass has holes, but with continuous water supplies, they can drink. Japanese glass has no hole, but with no water input, they cannot drink."

The former is like EUR/USD. With liquidity, it is attractive. The latter is like USD/HKD. With no liquidity, it is just not. Or the result is the cause. Japan has no charm, so no one comes. Stagnate water. No changes in the leader class. I can see good descriptions in Carlos Ghosn's "Broken Alliances."

The Japanese bureaucrats love ad balloons. The current startup campaign resembles the 10k postdoc campaign around the Millenium.

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"The tragedy of Japan is that its problems are so much easier to solve, but yet they don’t solve them. The American tragedy is that our problems are really hard to solve, and we’re not even facing them. Instead, we’re just glaring at each other angrily." This was really well-said. Thanks for this insightful piece and interview.

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Mm. Good points.

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I think if the issues with the Japanese economy were simple there would have been some progress over the past 30 years. The Japanese education system is great at training people in math and science, but is fails at teaching continuous leaning, competition and business management. In addition the legal system is antiquated and focused on not letting innovation happen.

How can you increase the level of entrepreneur activity when you don't have a bankruptcy system that allows them to fail?

Japan has a legal system that basically states "If we say you can do something than you can do it." Every country that is successful in promoting entrepreneurs has a system where "if we say you can't do something than you can't." The difference is that in Japan you have to have all your new and innovative ideas vetted by the government before you can produce them (or sell the service). By the time you get the OK your "new" idea is broadly known.

I don't know of a single major business school in Japan.

The US does have issues with some schools. We have a sometime militant set of teachers' unions. We need competition to displace them. There are issues with government lenders allowing larger and larger loans to students without considering the financial opportunities of the degrees the students are paying for.

I don't fully understand your minimum wage comment. If turnover is an issue and people are getting paid minimum wage -- are they leaving for jobs with higher wages? Would you not have the exact same issue if the minimum wage is higher? You state that employees won't jump jobs if they are paid a bit higher and this would save companies money... are you suggesting that Japanese companies are not smart enough to understand this? Minimum wages have been set as "starter" wages -- the level they are set has little effect on the economy -- if jobs are plentiful and employees are not than wages go higher. If your comments about wages are correct, isn't it smarter to have a low minimum wage and let the better companies attract and pay the best workers the most money? Isn't the issue more a lack of job mobility?

If the Japanese are so much better educated than Americans... Why is the US GDP (PPP) per capita over 1.5x that of Japan? (IMF statistics).

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What do you think about giving entrepreneurship visa to foreign students who really want to stay in Japan after graduation?

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