Nature of Economic Plans in a Market Economy
Economic plans in the market economy were geared to communicate government’s views on the future of
Japanese economy to the public, and to form a national consensus. Japanese economic plans usually consisted
of the following ingredients: i) medium-term development scenario that the government assumes, including an
economic framework such as targeted rates of economic growth and inflation; ii) medium-run economic policy
goals and policy priority, including allocation of investments in social overhead capital in the plan period; and
iii) private sector’s actions that the government considered desirable. As such, these plans were of an
‘indicative-type’ rather than those of ‘command-type’ widely seen in central planning economies. Acceptance
of those suggested actions was optional rather than compulsory