ABSTRACT
This chapter discusses the dualistic character mainly in the sphere of production methods. As far as the coexistence of premodern and modern methods of production is concerned, Japan and underdeveloped countries in Asia have something in common. In Japan, however, premodern and modern branches are unified in a national economy, whereas in Asia's underdeveloped countries they remain marked by the colonial economy and the mono-culture economy. In Japan, differentials in wages and interest rates, manifested by the utilization of relatively cheap labor in medium and small enterprises, and relatively low interest rates for large enterprises have solidified the dual structure of the Japanese economy. An anticipated slowing-down of growth in the labor supply, the increasing trend of demand for labor due to capital formation, and the promotion of foreign trade liberalization are putting pressure on the premodern sectors. These facts have started a trend towards the abolition of the dual structure.
