ABSTRACT
The nineteen sixties witnessed trade liberalization in the Japanese economy, with foreign exchange restrictions partially removed. In contrast to the "hothouse" atmosphere up to the end of the fifties, industry studies shifted their focus to Japan's international competitiveness. Of especial importance in this regard is the industrial policy which aimed at increasing industrial concentration and promoting mergers in order to cope with impending liberalization of trade. The theory of industrial organization is an applied field of economics which conducts industry studies in particular reference to how to regulate the market in order to maximize the economic welfare of the nation. It is at this point that the approach basically differs from earlier industry studies. The basic problem of industry, however, is not limited to enforcing the social responsibility of enterprises; it is fundamentally tied to the management of institutions and policy as to how to regulate activities of enterprises and industries.
