7 BETTING ON HYDROGEN: JAPAN’S GREEN INDUSTRIAL POLICY …
153
that can help alleviate climate change, since the potential public benefits
are so large.
Overcoming these market failures often requires some form of government industrial policy support to change private incentives. In the case
of the promotion of energy-related industries, this approach is known
as “green industrial policy.” Developing clean energy industries at the
massive scale required and “with the speed needed cannot be done
without industrial policies” (Hallegatte et al. 2013, p. 21). 3 In particular, governments can play a useful role in establishing a stable framework
for public–private coordination, clear and consistent policy objectives and
goals, and a long-term public commitment to the industry. Only when
policy commitments are consistent and predictable will private sector
actors make the needed investments. 4
Industrial policy is exactly what Japanese public policymakers, working
in conjunction with private sector companies, have been attempting to
do throughout the postwar period, for a wide range of industries. And
although industrial policy is not as overt as it was during its high-growth
era, it has continued to support the promotion of future technologies.
Given this long history of industrial policy, Japan may be in a unique
position to pioneer green industrial policy. Indeed, Japan has been “repurposing” its industrial policies in this direction ever since the Oil Shocks.
As Hughes argues, Japan’s industrial policy has been “retained and redeployed” in this direction, in terms of spending, ministry personnel, and
policy activity (Hughes 2012, pp. 109–111).
Japan’s approach to industrial policy has traditionally been a collaborative one, bringing together Japanese government officials with the private
sector and scientists. This approach is known as the san-kan-gaku (産
官学) system, in which industry actors (san), government officials (kan)
and the academic research world (gaku) cooperate in the formulation and
implementation of industrial policy. 5 Typically, the Japanese government
will convene some form of a deliberative policy council, made up of
government officials, representatives of the private companies, related
academic experts, and other notable figures. The role of the private
sector, namely the firms and industries most affected by policy, has been
particularly important. Private sector actors are always involved in these
deliberations and are very often the driving force behind policy creation
and implementation.
153
that can help alleviate climate change, since the potential public benefits
are so large.
Overcoming these market failures often requires some form of government industrial policy support to change private incentives. In the case
of the promotion of energy-related industries, this approach is known
as “green industrial policy.” Developing clean energy industries at the
massive scale required and “with the speed needed cannot be done
without industrial policies” (Hallegatte et al. 2013, p. 21). 3 In particular, governments can play a useful role in establishing a stable framework
for public–private coordination, clear and consistent policy objectives and
goals, and a long-term public commitment to the industry. Only when
policy commitments are consistent and predictable will private sector
actors make the needed investments. 4
Industrial policy is exactly what Japanese public policymakers, working
in conjunction with private sector companies, have been attempting to
do throughout the postwar period, for a wide range of industries. And
although industrial policy is not as overt as it was during its high-growth
era, it has continued to support the promotion of future technologies.
Given this long history of industrial policy, Japan may be in a unique
position to pioneer green industrial policy. Indeed, Japan has been “repurposing” its industrial policies in this direction ever since the Oil Shocks.
As Hughes argues, Japan’s industrial policy has been “retained and redeployed” in this direction, in terms of spending, ministry personnel, and
policy activity (Hughes 2012, pp. 109–111).
Japan’s approach to industrial policy has traditionally been a collaborative one, bringing together Japanese government officials with the private
sector and scientists. This approach is known as the san-kan-gaku (産
官学) system, in which industry actors (san), government officials (kan)
and the academic research world (gaku) cooperate in the formulation and
implementation of industrial policy. 5 Typically, the Japanese government
will convene some form of a deliberative policy council, made up of
government officials, representatives of the private companies, related
academic experts, and other notable figures. The role of the private
sector, namely the firms and industries most affected by policy, has been
particularly important. Private sector actors are always involved in these
deliberations and are very often the driving force behind policy creation
and implementation.