ABSTRACT
This chapter presents an overview of the United States (US) Japanese relationship, with an emphasis on the dynamics of our economic relations, during the past quarter-century. The problem over textiles proved to be the first of a long series of trade frictions that plagued Japanese exports. In 1969 Professors Hendrik S. Houthakker and Stephen P, Magee, who were then members of the President's Council of Economic Advisors, released a study concluding that the US-Japanese bilateral trade balance would gradually tend to increase US deficits over the long term. The government of Japan has acted to lower and dismantle nontarift trade barriers. The Tokyo Round was thus initiated in the hope that agreement among the member countries to further lower their tariffs and to lower or dismantle nontariff barriers could lead to a further expansion of the international trade.
