RIETI Report Sep 2005

A Vision for RIETI: A Think Tank that Shapes Japan's Long-Term Policy

This month's featured article

A Vision for RIETI: A Think Tank that Shapes Japan's Long-Term Policy

OIKAWA Kozo Chairman, RIETI

Greetings from RIETI

Tokyo has long been known for its superior public transport system but, believe it or not, there are still some parts of greater Tokyo that lack easy access to downtown. Tsukuba, a city some 60 kilometers northeast of Tokyo, was one such place. No more. With the completion of the Tsukuba Express line, or "TX," Akihabara, one of Japan's major hotspots for cutting-edge IT development -- and its best-known mecca for electronic gadgets -- has been linked to Tsukuba, one of the country's leading research centers.

Running 58.3 kilometers from Tokyo's Akihabara district and whisking passengers along at speeds of up to 130 km (80.8 miles) per hour, TX promises to make life much easier for Tsukuba's scientists and other residents, cutting the commuting from end to end in half to just 45 minutes. The stations in between offer that rarest of Tokyo area commodities: room to grow. New housing developments are already under construction and are likely to draw a large number of young families enticed by the prospect of an affordable home in a park-like setting.

A lot of thought has gone into the design of TX stations. Tsukuba station, for example, has the Space Age look one would expect of a world class technopolis, while Asakusa, the third stop from the Akihabara terminus, combines a modern feel with murals depicting the area's age-old festivals, temples and cultural icons. As for the TX cars themselves, they do not disappoint. Designed for comfort as well as speed, their greater width eliminates the claustrophobic feel of the typical commuter train. What's more, they feature high-speed wireless Internet access -- a real plus for the harried researcher looking to put the finishing touches to a presentation. So take a ride on the TX and get a glimpse into the comfortably modern future of commuting. And don't be surprised if your next must-have electronic gizmo appears in Akihabara even sooner.

Special Interview

On August 5, 2005, Kozo Oikawa was appointed chairman of the Research Institute of Economy, Trade and Industry. In a recent interview with RIETI Report, the new chairman discussed his future goals for RIETI as a policy think-tank as well as his management vision.

For a detailed biography of Mr. Oikawa, please go to
http://www.rieti.go.jp/users/oikawa-kozo/index_en.html

RIETI Report: Before assuming your current post, what were your impressions of RIETI?

Oikawa: RIETI gave the impression of being very well-endowed intellectually. I had attended some Brown Bag Lunch (BBL) seminars and always saw a wonderful lineup of people in the audience, to say nothing of the speakers. I found the BBLs discussions very vigorous and unconstrained. I also have had opportunities to attend symposiums and other events organized by RIETI and I was very impressed with the high quality of these events, as seen in the diversity of themes taken up, the variety of attendees, the theoretical soundness of the debates, and so forth. With respect to research output, I have read a number of RIETI publications, including titles from the Economic Policy Analysis Series and the Economic Policy Review Series. These books gave me a great deal of insight concerning some of the issues I had been thinking about.

RIETI Report: What sort of research do you think RIETI should be undertaking?

Oikawa: I used to serve as an advisor to Nomura Research Institute and at that time an acquaintance told me something that stuck in my mind. He said, "RIETI has been doing brilliant research and generating high-quality outputs. But I do hope that RIETI will take advantage of being a government-affiliated think-tank and step up its efforts to undertake long-term systematic research. For instance, RIETI can ponder what policies Japan should pursue to reinforce its industrial competitiveness at a time when the country's population has begun to fall, while keeping an eye on overall economic conditions in Japan."

Now that Japan has regained some confidence as compared to the 1990s, I believe RIETI will be expected to focus on new institutions and frameworks in our research. It will take considerable knowledge, funding and time to do so. Of course, some private-sector institutions have been doing this kind of research but in Japan, policy proposals made by private-sector think tanks do not usually generate profits. Thus, to undertake the kind of research that can serve as the foundation for policy proposals, it is indispensable to have stable financial resources. It is often difficult for busy government ministries such as the Ministry of Economy, Trade and Industry (METI), to conduct policy research and implement policies on their own. Many government officials therefore feel the need to work out policy measures based on research conducted by research institutes such as RIETI. I believe we should steadfastly undertake the kind of basic research that can meet such needs.

RIETI Report: What steps should RIETI take to achieve that end?

Oikawa: First, it is imperative to forge and maintain close ties with policymaking authorities. At the same time, we must remember that bureaucrats are not the sole creators or advocates of policy today. A variety of other actors such as non-profit organizations are becoming increasingly influential. The policies implemented by government must be selected from a host of policy options based on diverse values. What is required of government-affiliated research institutes like RIETI is to accumulate reliable data and materials for analysis that are conducive to the selection of optimal policies. For instance, we can examine various policy options and, after taking into consideration the opinions of external experts, we can suggest that policy "A" would be most desirable from one point of view, but policy "B" would be preferable from another. The point is there will be no viable policy where there is no reliable research.

RIETI Report: Japan is entering an era where people choose political parties based on their policies. Because of this, RIETI is expected play an even more important role in the future. What kind of think tank do you think should RIETI seek to become?

Oikawa: First and foremost, RIETI must be neutral because it is a government-affiliated agency. With the end of the Cold War, ideological conflicts are less pronounced, and we hardly see policy conflicts stemming from differences in absolute values. However, as I said earlier, both people's values and policy proposals are becoming increasingly diverse. RIETI needs to enhance its ability to mobilize expertise so that it can collect and analyze useful data, thereby helping policymakers and the general public to formulate sound policies. Fortunately, a number of experts are already participating in this endeavor as RIETI fellows and I am grateful for their efforts. Now we must create an environment where the capabilities of these experts can be even more effectively utilized. At present, the government is discussing various issues for the implementation of our second set of mid-term objectives starting in fiscal 2006, based on which we will formulate a concrete plan for our research activities. I am hoping RIETI will become a research institute that can help define a long-term philosophy and vision for Japan.

RIETI Report: As chairman of RIETI, what is your management vision for the organization?

Oikawa: I believe RIETI should take full advantage of its status as an incorporated administrative agency (IAA) to serve as a catalyst to stimulate interactions between academia and policymakers. Let me use the management of a private-sector company as an analogy. The ultimate output of a private-sector company is its products; in the case of government, the "product" is policies. A private-sector manufacturer starts by looking at a scientific principle. Then, using that principle, the company conducts research and development. By combining various technologies developed through its R&D activities, a new product is created. Management then takes responsibility for marketing the product. If we replace the term "product" with "policy," it looks like this: The search for a scientific principle is undertaken primarily in academia. Based on such scientific findings, RIETI conducts policy research that serves as a foundation for formulating policies. The function of RIETI is thus comparable to R&D. Policy proposals and recommendations are then put forward by RIETI, examined, and incorporated into concrete policies by METI, which is comparable to a factory rolling out new products. Thus, RIETI serves the function of R&D. Not all the proposals we make will be developed into concrete policies or finished products, but without sound R&D such as we do here, it would be difficult to develop good policy. In this sense, RIETI has a heavy responsibility.

Interview conducted by Toko Tanimoto, chief editor of the RIETI website (September 1, 2005).

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