As generally described, Japan's development of the internet industry has fallen behind even other Asian economies. Even though Japan's first trial of policy reformation in the mid 1980s was relatively early, what made this critical delay? Shin Yasunobe will present and evaluate Japan's policy track record in the 1990s. He will also present unique aspects of Internet development recently observed in Japan, and their implications for the future. Shin Yasunobe, formerly a high-ranking official with the Japanese Ministry of International Trade and Industry (MITI) has been appointed executive director at Stanford Japan CenterÑResearch, located in Kyoto. Yasunobe is a twenty-two year veteran of MITI who left his post as director of its Electronic Policy Division in the Machinery and Information Industries Bureau to take the reins of a new project at Stanford Japan CenterÑResearch. This project will be a set of comparative studies on the international dimensions of the Internet and e-commerce, with particular focus on the Asian economies.

When the Asian Crisis hit in 1997, California looked particularly vulnerable. Foreign markets had been of growing importance to the state's economy over the previous decade, and California's trade was heavily weighted toward Asia. The US trade deficit had been rising steadily and the rapid depreciation of Asian currencies threatened to dampen demand for the state's goods, while at the same time flooding it with imports. Yet the State's economy weathered this storm quite well. Why? Kroll and Bardhan will present research on California's linkages with the global economy which help explain this outcome. Additionally, Kroll and Bardhan will present research showing how California is becoming integrated with the global economy in other, more complex ways. California-based firms have expanded their sales and production activities throughout the world, and production that occurs within the state has come be increasingly linked to Asia for imports of intermediate inputs. Cheaper inputs and finished goods in turn have moved the economy to higher value-added sectors and related services. Kroll and Bardhan will discuss the some consequences of these linkages and analyze their effects on the employment structure of the state. Dr. Cynthia Kroll is Regional Economist at the Fisher Center for Real Estate and Urban Economics, at the University of California at Berkeley. She holds M.A. and Ph.D. degrees from Berkeley's Department of City and Regional Planning, and serves as an advisor to the California Office of Economic Research and the Association of Bay Area Governments Ashok Bardhan is a research associate at the Fisher Center, and served formerly as an officer with the Reserve Bank of India.

Bill Gates recently said "if the 1980s were about quality and the 1990s were about reengineering, then the 2000s will be about velocity. When the increase in velocity of business is great enough, the very nature of business changes." These three factors--quality, reengineering, and velocity-are rapidly changing the structure of foreign trade. They directly affect relationships such as the flow of imports, exports and foreign direct investment. Such complex networks of global and local interactions generate new ways of doing business by selectively collapsing time and space relationships. This rapidly evolving complex system is making it very difficult for policymakers to analyze public policy trade related issues or to evaluate the possible impact of their decisions. New ways to visualize, develop, implement and evaluate California State foreign trade policy are needed. Dr. Koehler's presentation will lay out some of the elements that might be included in such an approach to state trade policy making, and identify various options for California State government. Dr. Gus Koehler is Senior Policy Analyst with the California Research Bureau, where he conducts policy research for the State Legislature and the Governor's office. His current research responsibilities include identifying and evaluating state economic development issues and strategies for addressing them. The author of California Trade Policy (1999), Dr. Koehler serves as adjunct faculty of Public Administration at the University of Southern California.

Japan's macroeconomic problem has yet to be properly diagnosed. Throughout the 1990s, policy makers could not decide on the proper macro economic measures to combat the country's severe economic slump. We propose a unified explanation, with deep historical roots, of why aggregate private demand failed to recover after Japan's stock and real estate bubbles burst in 1991 and deflationary pressure continues into the new millenium. Ron McKinnon is William D. Eberle Professor of International Economics at the Department of Economics, Stanford University. His research interests cover trade and financial policy in less-developed countries, the transition from socialism in Asia and Eastern Europe, the foreign exchange market and U.S.-Japan trade disputes, European monetary unification and international monetary reform, and the economics of market-preserving federalism. Rishi Goyal is a Ph.D graduate student in international economics working with Professor McKinnon on a Japan project--and will be writing his dissertation in this area. His undergraduate B.A. (with distinction) is from Swarthmore College in 1995. He expects to complete his Ph.D in 2001.

12.00 p.m. Mr. Noriaki OZAWA (Ministry of International Trade and Industry, Japan) What is Japan? A Look at Japan's Changing Sociocultural Identity. 12.20 p.m. Mr. Nobutake SHIRAI (Ministry of Post and Telecommunications, Japan) Internet Business in U.S. and Japan: A Comparative Study. 12.40 p.m. Mr. Raita SUGIMOTO (Toyota Motor Corporation, Japan) Reorganization of the Automobile Industry and its Impact on the Asian Market. 1.00 p.m. Mr. Takeo TAKIUCHI (The Patent Office, Japan) Entrepreneurship through Technology Transfer in Silicon Valley. 1.20 p.m. Mr. Kenji UCHIDA (The Kansai Electric Power Co., Inc., Japan) Setting Up New Ventures In-house at Kansai Electric Power Company. 1.40 p.m. Mr. Zhi-Jie ZENG (CITIC Pacific, Hong Kong) China's WTO bid and the Effect on China's Internet Business. Research Introductions: Mr. Yong-Ky EUM (Hyundai Heavy Industry, Korea) Mr. Jiang FENG (People's Bank of China, PRC) Ms. Xiaohui ZHANG (People's Bank of China, PRC)

The Asia Pacific Economic Cooperation forum completed its first ten years in 1999. It is appropriate to pause and look back at its evolution over this period, and look forward to assess its future role in the multilateral world of the World Trade Organisation (WTO). This paper attempts both of these tasks from a New Zealand perspective. The factors and forces behind regionalism, its points of confluence and conflict with multilateralism, and its future role in a globalised international economy are all addressed in this paper. How the forces of regionalism are shaping up in the Asia-Pacific region, and how New Zealand - a small open economy - is linking itself into it are anlysed to put New Zealand's recent economic reforms in an international perspective. To what extent New Zealand and other countries in the Asia-Pacific area can learn and benefit from the experiences of one another is brought into sharper focus in the paper. Professor Srikanta Chatterjee is a professor of international economics at Massey University in New Zealand. A native of India, Professor Chatterjee studied economics at the Universities of Calcutta, India, and Surrey and London, England, receiving his Ph D from the London School of Economics. Besides New Zealand, Professor Chatterjee has been on the full time faculty in universities in India, U.K., Australia, Japan and Fiji. He has also been on the visiting faculty in Australia, Bangladesh, Botswana, China, Italy, India, Japan, Korea, Malaysia, Mauritius, the Netherlands, Norway, Singapore, South Africa, Swaziland and Vietnam. In 1997, Professor Chatterjee was a Japan Foundation Fellow at the Tokyo Keizai University, and, in 1998, he spent a semester at the Kyoto Ritsumeikan University as a New Zealand Asia 2000 Foundation Visiting Professor of Asia-Pacific Studies. Currently a Fulbright Travelling Fellow, Professor Chatterjee is visiting Berkeley, and attending a conference in San Diego before going on give lectures at the University of Colima in Mexico. Professor Chatterjee's teaching and research interests include international economics, international business, the Asia-Pacific economies, inequality and income distribution, and the economics of the household.

An eminent historian of China and Overseas Chinese, Wang Gungwu has served as President of the University of Hong Kong, Professor and Director of the Research School of Pacific Studies at the Australian National University, and Dean of Arts at the University of Malaya in Singapore. He is currently Director of the East Asian Institute at National University of Singapore and Distinguished Professorial Fellow at the Institute of Southeast Asian Studies. His many books include The Nanhai Trade: The Early History of Chinese Trade in the South China Sea (1958, new edition 1998); Community and Nation (1981, new edition 1993); China and Southeast Asia: Myths, Threats, and Culture (1999); The Chinese Overseas: From Earthbound China to the Quest for Autonomy (2000).

Traditionally, an entrepreneurial spirit has not been seen as something of much value in Japan. However, the Japanese government has undertaken a variety of short-term and long-term measures to revitalize the Japanese economy through creating new business opportunities and employment. Mr. Yoda's discussion will touch on the SBIR, the Japanese version of the Bayh-Dole Act, the revision of the Bankruptcy Act, the revision of the standard for accounting as well as the revision of patent law for research institutes at national universities. To further promote the development of new enterprises and support for their growth, tax provisions, such as the "Angel Tax", have been revised and the number of incubators available for new entrepreneurs to use are also subject to increase. Through the revision of patent law, the relationship between university research institutions and private businesses in Japan will become a key factor in Japan's revitalization. Expected results from these government strategies as well as some aspects of these revisions that need to be further considered will be discussed by Mr. Yoda along with his analysis of the potential role of the Japanese government in facilitating entrepreneurial links between Japan and Silicon Valley. Mr. Yoda serves as Chief Executive Director of the Japan External Trade Organization's (JETRO) San Francisco office, where he as served since 1997 as a liaison between the Japanese and the US business communities. His primary responsibility is implementing Japanese trade promotion programs and assisting US companies looking to enter the Japanese market. Previous to his assignment at JETRO San Francisco, Mr. Yoda spent 25 years working for the Ministry of International Trade and Industry (MITI) and other governmental organizations. Mr. Yoda has also served as Commercial and Economic Councilor for the Japanese Embassy in Ottawa, Canada (1991-94). Mr. Yoda received a BA degree in Law from Kyoto University. He frequently takes part in directing JETRO's trade promotion activities as well as promoting the Japanese market to U.S. business and community leaders.

The great economist, Alfred Marshall, said of industrial districts: "The mysteries of the trade...are as it were in the air...." This seminar reports on a project that addresses the "mysteries" of the Valley (at least to many of the people who want to replicate it). Key topics to be discussed are a habitat that is unmatched in its ability to create new firms and take ideas to market rapidly, the edge provided by communities of practice, the high quality and highly mobile labor force, the various roles of government in the rise of the Valley, and how changes in technology and markets have favored it. Henry S. Rowen is Director of the Asia/Pacific Research Center at Stanford University. He is a senior fellow at the Hoover Institution and the Edward B. Rust professor emeritus at the University's Graduate School of Business. From 1989 to 1991, Rowen was the assistant secretary of defense for international security affairs in the U.S. Department of Defense. He was also chairman of the National Intelligence Council from 1981 to 1983, served as president of the RAND Corporation from 1968 to 1972 and was assistant director of the U.S. Bureau of the budget from 1965 to 1966. He recently was the editor of Behind East Asian Growth: The Political and Social Foundations of Prosperity, published by Routledge Press, 1998. At the present time, he is co-editing a book on how the Silicon Valley system of innovation and entrepreneurship works. The next phase of this project will examine high technology centers in Asia.