Preface

Summary

The United States, Germany, and Japan – the world's three most powerful and successful free market societies – differ strikingly in how their governments relate to their economies, running the gamut from low to high market intervention. Each nation varies in the basic institutions that shape its social, political, and economic structures and processes, in the balance of power among contending groups, and in the rules of its political games. In a fractious world whose leading nations fret about who buys cars from whom, such seemingly minor distinctions assume vast significance. A nation's economic health and that of its citizens turns on such mundane matters. And all national governments, especially that of Japan, take increasingly enlarged stances toward directing growth and trade strategies.

In this struggle, a key public arena is labor policy, which modulates the condition of the working populace. Numerous government policies – ranging from restructuring the entire economy, to imposing taxes, to regulating wages and working conditions, to designing welfare “safety nets” to catch workers when they lose their jobs – comprise the labor policy domain. Following Otto Bismarck's late-19th-century creation of worker protection and welfare laws for Imperial Germany, national governments have embraced, with greater or lesser enthusiasm, an expanding responsibility for mediating the relationships between employers and employees. These policies greatly affect the productivity and health of the entire economy, including the growth and export rates so evident among international competitors.