Question 2: Why do Japanese automakers operate some factories in America instead of importing everything from Japan?
Subsidies and tariffs are the reason for this. Importing a finished car into the USA from Japan will face tariffs (taxes) imposed by the US government. A car built in the USA by a Japanese company will benefit from subsidies given out by the US government. The entire point of these policies is so that the factories are moved from eg. Japan to the USA. This makes the cars more expensive overall (if it was cheaper to make them in America the companies would have already done this without the government intervention), but has the effect of moving employment from Japan to the USA.
Overall it makes the whole world a tiny bit poorer than it could have been, and moves a small amount of employment from one place to another. (IE it may be net-good for the USA, assuming that you think workers are more important than consumers, but it is pure-bad for Japan and net-bad for the world. Its kind of like Defecting in a two-country prisoner’s dilemma, with the added twist that the prize you get for defecting is only beneficial to some of your citizens and is harmful to others.)
Question 1: Why would an hour of labor from an American be worth 2x as much as an hour from a Japanese employee?
An hour spent working in Japan produces half the value of an hour spent working in the USA. This does not mean that an American can do the same job twice as fast as a Japanese person. For one thing, American’s have different jobs than Japanese people. For another: Japanese people have office culture rules that nobody goes home before the boss. This means that at 8pm on a weekday, if the boss hasn’t gone home yet, nobody else has either (a common occurrence). But they all got brain-fried from overwork at 6pm and have been twiddling their thumbs for two hours. The statistics will then show is the total number of hours (including those two hours wasted) and the output, and they will come out on-average less productive than Americans. That is just one example of the kind of thing that can move the dial on that. As another example, one hour of labour from a man with a combine harvester really is worth dozens or hundreds times as much as one hour of labour from a man with a scythe. Japan’s use of technology may be behind the US’s. Not with literal scythes. Maybe faxes instead of emails. Things like that.
In 2019, the average Japanese employee worked 1,644 hours, lower than workers in Spain, Canada, and Italy. By comparison, the average American worker worked 1,779 hours in 2019.
That is really interesting, thanks for sharing it. Japan has such a reputation for this that it is fascinating to see that eg. Italians and Spaniards work more hours despite the European working time directive.
Question 2: Why do Japanese automakers operate some factories in America instead of importing everything from Japan?
Subsidies and tariffs are the reason for this. Importing a finished car into the USA from Japan will face tariffs (taxes) imposed by the US government. A car built in the USA by a Japanese company will benefit from subsidies given out by the US government. The entire point of these policies is so that the factories are moved from eg. Japan to the USA. This makes the cars more expensive overall (if it was cheaper to make them in America the companies would have already done this without the government intervention), but has the effect of moving employment from Japan to the USA.
Overall it makes the whole world a tiny bit poorer than it could have been, and moves a small amount of employment from one place to another. (IE it may be net-good for the USA, assuming that you think workers are more important than consumers, but it is pure-bad for Japan and net-bad for the world. Its kind of like Defecting in a two-country prisoner’s dilemma, with the added twist that the prize you get for defecting is only beneficial to some of your citizens and is harmful to others.)
Question 1: Why would an hour of labor from an American be worth 2x as much as an hour from a Japanese employee?
An hour spent working in Japan produces half the value of an hour spent working in the USA. This does not mean that an American can do the same job twice as fast as a Japanese person. For one thing, American’s have different jobs than Japanese people. For another: Japanese people have office culture rules that nobody goes home before the boss. This means that at 8pm on a weekday, if the boss hasn’t gone home yet, nobody else has either (a common occurrence). But they all got brain-fried from overwork at 6pm and have been twiddling their thumbs for two hours. The statistics will then show is the total number of hours (including those two hours wasted) and the output, and they will come out on-average less productive than Americans. That is just one example of the kind of thing that can move the dial on that. As another example, one hour of labour from a man with a combine harvester really is worth dozens or hundreds times as much as one hour of labour from a man with a scythe. Japan’s use of technology may be behind the US’s. Not with literal scythes. Maybe faxes instead of emails. Things like that.
The real overtime cultures are China, India, Mexico, and South Korea.
That is really interesting, thanks for sharing it. Japan has such a reputation for this that it is fascinating to see that eg. Italians and Spaniards work more hours despite the European working time directive.
Wow, and Mexico’s fertility rate just plunged to 1.82