Discuss the view that the differences between the German and Japanese Essay

Discuss the view that the differences between the German and Japanese economic institutions are so great that they cannot be viewed as being part of the same family of economies - Essay Example Since these companies do not need to operate in a government controlled environment, they have an access to an educated and trained labour force (Noel, 2004, p. 3; Pavitt, 1999, p. 5). The economies of Germany and Japan are two major examples of coordinated market economies (CMEs) in the world. Unlike the situation in United States and United Kingdom, these nations do not implement high-end regulations in their bank structure primarily due to the informal structure of organisation. However, despite the integral business environment being the same, many-a-times it is difficult to conceive them as part of the same group due to the diverse nature of their economies. The present paper takes up the issue and tries to figure out the extent to which the German and Japanese economic institutions differ from each other. Corporate governance in economic institutions located at Japan and Germany are almost similar to each other. Institutions in these nations are characterised by senior managers sitting at the head of the power unlike in case of liberal market economies, where the culture of corporate governance is seldom found. The shareholders are the ultimate owners of the organisations, although no corporate board structure is present in them. Though the strategies which these nations abide by have rendered them to a position much behind that of USA, the financial institutions of the former nations are believed to be fast picking up with those indigenous to the latter (Baums, Buxbaum & Hopt, 1994). Corporate governance in these nations is strengthened more due to the emphasis that company goodwill is being paid rather than in case of liberal market economies like the USA where people are more concerned about the final pay-off only (Jackson, 2005). Germany had been a capitalist at its heart at the time of unification. It had been one of the most popular of