98年度著作へ

1998年00月00日

CAN JAPAN SUCCEED IN "CHIGYO-KA"

A 1998 Revised Version of the Paper Originally Published in Technological Forecasting and Social Change, Volume 49, Number 2, June 1995. 147-164.

SHUMPEI KUMON

ABSTRACT

There are two aspects in today's information revolution that started in the late 1970s.The first is an aspect referred to as "the third industrial revolution," which triggers the transition to the "2lst century system of industrialization." The information revolution in this sense brings the creation of new "breakthrough industries (new multimedia industries)." And the second aspect of the information revolution possesses the characteristics of both a technologica1 revolution and a social revolution and brings about the arrival of the third phase of the historical evolutionary process of the modern civilization, which proceeds through three phases, namely "militarization,industrialization,and then informatization."

If the bearers of modern industrialization are a "group of enterprises" that have been engaged in the race in order to gain "wealth" (generalized means of exchange/exploitation),and if these enterprises' activities have been exercised in the world market where their products have been sold, then it is appropriate to call the bearers of informatization a "group of intelprises." They will be engaged in a competitive game to gain "wisdom" (generalized means of persuasion/inducement),and the arena of their activities can be called a "global intelplace" where "sharables," that is, information and knowledge created under the intention to share them with others, will be disseminated. Thus, toward the 21st century,the third phase of modernization,which can be called the "informatization or intelprise formation" or the era of the "wisdom game" (intellectualism), is about to begin.

Japan's "ie society (a society based on the ie principle - literally,ie means "house" but here it is interpreted as a cultural principle for organizing a society),which has been going through the process of social evolution on the Japan Archipelago since the 10^th century, has developed a network-based organization with little stratification in its structure. In this sense,Japanese society can be characterized as a "network-oriented society" in which intelprises and the intelplace in the broad sense have functioned as the essential components of the society. In general,an intelplace and intelprises that operate actively within this framework serve as the flexible bases for different types of socia1 relations and institutions, such as states and markets and eventually integrate them into the society as a total system, at least to a certain extent. In fact, it took place quite regularly during the modernization "in the narrow sense," or Westernization of Japanese society after the Meiji Restoration. There exist some problems,however. Some of the characteristics found in Japanese society may become obstacles to activities aimed at sharing and promotion of information and knowledge in the global intelplace as well as Japanese participation in the "wisdom game." Badly needed are serious efforts for informatization in Japan to eliminate these obstacles as much as possible.

There is one episode that U.S. Vice President Gore likes to relate. When he visited the Republic of Kyrgyzstan, President Akayev told him that his 8-year-old son had said,"Father,I have decided to study English." When the president asked him why,his son answered,"Because computers speak English."

This episode we11 symbolizes America's superiority in "information technology (IT)." In fact, I am almost convinced that the ultimate goal of engineers from the former Soviet Union and the Eastern European nations, whom I have encountered during the last few years, was to catch up with and surpass the U.S. in the field of information technology in order to accomplish the revitalization of their own countries. The nations that adopted Soviet-style socialism, though they fell behind the Western counterparts in industrial modernization,succeeded in catching up with the U.S. in the field of military technology. They also threatened to catch up with the developed nations in heavy and chemical industries. These nations had serious trouble closing the gap in the production of consumers' durables,however,such as passenger cars and electric appliances. In the end,their centralized command economy had its weakness exposed in the development of information technology. Today, people in the former Soviet Union and the Eastern European nations are desperate to make up for the semi-developed status of their information technology after losing the "Cold War." They remind me of Japanese engineers and business people during the postwar period who tried hard to acquire the latest mass-production, processing, and assembly technologies from the U.S. because they came to realize that the war had been lost because of America's "material superiority."

Where does Japan stand today? In the 1960s, Japan developed the concept of "information industry," "informatization," or "information society" ahead of the rest of the world. Then,in the 1970s, Japanese engineers were astonished by the ICs developed in the U.S. and devoted their entire energies to the study and advancement of this technology. Thanks to such efforts, Japan finally won the title of the "Kingdom of ICs." The following words are printed on the back cover of a book [1] containing episodes from a TV series,which was published by NHK (Nihon Hoso Kyokai = Japan Broadcasting Company) three years ago and later captured a wide readership:

Every flow has its ebb,however. Although Japan was enjoying its superiority over the U.S. and the prosperity of the bubble economy, America was steadily revitalizing itself. In his prescient book entitled Microcosm [2] published in 1989, George Gilder summarized this transition as follows. From the late 1970s to the early 1980s, Japan could stay ahead of the U.S. because it succeeded in making CMOS technology available for commercial use and applying this technology to consumer products. Until the early 1980s,the U.S. did nothing but criticize Japan for its illegal dumping,excessive governmental funding,and unfair trading. Later in that decade,however, it made a successful comeback by narrowing the gap in CMOS technology and regained its superiority by developing microprocessors designed for specific applications. And now?

The U.S. is still maintaining this growth today and is capable of doing so in the future.

In the end, Gilder concluded as follows:

A more detailed analysis of this development from a similar point of view has been made in a couple of more recent books. Beating Japan [3] by McInerny and White and A Crisis of Japanese Technology by Finan and Fry [4]. Gilder's intellectual influence has been gradually growing since the publication of the aforementioned Microcosm and the following Life after Television [5]. Nevertheless, it appears to me that this kind of "precept" is not always correctly understood either in the U.S. or in Japan. The U.S. Government and Congress are eagerly promoting industrial policy to strengthen the "competitiveness of its own industries in the international market" and trading policy to reduce its trade deficits. In Japan, although some have come to realize that they fell behind the U.S., the majority still have a poor understanding of the principles of the ongoing "information revolution," which requires the development of a system that enables entrepreneurs to simultaneously conserve resources and improve efficiency by means of intellectual power.

In my opinion, there are two aspects in today's information revolution, which started in the late 1970s. The first is an aspect referred to as "the third industrial revolution," which triggers the transition to the "21st-century system of industrialization." The information revolution in this sense brings the creation of new "breakthrough industries" (multimedia industries). These breakthrough industries are not designed to generate a massive amount of final demands by themselves. Rather, they are aimed at providing intermediate goods and services that will help other industries to achieve a revolutionary improvement in productivity, particularly in clerical work and services, for a full range of industrial activities - or even for activities in nonindustrial fields such as administration, medicine, and education. They are also expected to lead to a revolutionary decline in the cost of economic and social activities. In the end, the information revolution will contribute not only to a rapid reduction in product prices supplied by industries (price revolution), but also to a steady decline in various public utility charges, administrative costs, and prices of medical and educational services. Should this come true, it would be possible to cut down the total amount of governmental expenditure and reduce tax rates without affecting the quality of public services, even as the aging of our society advances further. At the same time, the information revolution will also provide us with an opportunity to actualize a new form of extended economic growth, instead of prolonged "deflation," provided that sufficient investment motivation is generated and additional training and redeployment of the labor force take place. In this sense, the first aspect of the information revolution began in the 1970s with the "economy of integration," or what Gilder called "technological innovation of the microcosm." Then, the second stage, started in the 1990s, was aimed at the generation of the "economy of networking," or "technological innovation of the telecosm." As Gilder puts it, a contribution made by a single computer to the improvement of productivity is insignificant. A computer not integrated into a network is like a car in a jungle. Only when it is connected with other computers via a network, no matter what kinds they are, can it demonstrate its full potential. In terms of this technological innovation of networking, or, in other words, the innovation of "object-oriented" technology, or, more specifically, that of technology used for "interface" among objects, Japan has fallen considerably behind the U.S. since the late l980s. Today, this problem is widely recognized in Japan. Once the nature of the problem is fully understood it will not be so difficult to catch up with the U.S. Even if it should be impossible to produce world-class computer hardware and software and a network to integrate them by ourselves, it should be quite possible for us to take advantage of imported products and technologies in order to improve productivity in other areas. (In fact, Mclnerny and White propose from such a standpoint that Japan specialize in environmental technology.) Rather, a more serious problem exists in the second aspect of the information revolution. In my interpretation, this second aspect of the information revolution possesses the characteristics of both a technological revolution and a social revolution and brings about the arrival of the third phase of the historical evolutionary process of the modern civilization, which proceeds through three phases, namely "militarization -> industrialization -> informatization." I argue that this second aspect of the information revolution is not fully understood even in the U.S. - even though I have come across several interesting studies - but even more so in Japan. Therefore, I would like to focus my observations on this second aspect of the information revolution in this paper.

Three Phases of Modernization

Modernization can be seen as a process in which human beings, particularly in groups, compete to achieve the immediate goal of acquiring and accumulating a variety of means, especially ones designed to control others' acts, so that they can realize their ultimate objectives more easily and completely. Based on this definition, the modernization process can be divided into three phases according to what means of control are sought as primary objectives. Generally speaking, the kind of acts used by social actors to control others, that is, "political act" in the broad sense, can be classified into three forms of "negotiation" behavior (threat, exchange, and persuasion) and three forms of "manipulation" behavior (coercion, exploitation, and inducement). "Negotiation" is a form of communicative control intended to make the other actor accept the demands of the acting party. Of various forms of negotiation, "threat" implies the possibility of punitive action if the demand is not met. "Exchange" suggests the granting of cooperation if the demand is met. And "persuasion" means to let the other actor believe that the acceptance of the demand leads to its own immediate benefits. By communicating these messages to the target actor, this type of political action helps the acting party realize control objectives. On the other hand, the indication of a demand is usually absent from manipulation-type political acts. In other words, this type of act achieves expected objectives by applying physical force in the case of coercion, by taking advantage of the other's carelessness in exploitation, or by inducing the target actor to voluntarily take a favorable behavior in inducement.

Of these six forms of political act, there is a certain kinship between threat and coercion, between exchange and exploitation, and between persuasion and inducement. Furthermore, in the historical context of modernization, the dominant actors of the time, which successively came into existence, respectively pursued each one of the three combinations of political acts (namely, threat/coercion type, exchange/exploitation type, and persuasion/inducement type) as the most expedient means to accomplish their objectives, whereas each of them endorsed as sacred the concept of some specific social rights. Then, these dominant actors concentrated on accumulating the means to execute the form of political acts they regard as most legitimate and started competing with each other according to a set of commonly accepted rules.

From this point of view, the first phase of modernization, which started showing full-scale development at the end of the 15^th century, was staged in the "international community" where a group of "states" (modern sovereign states) endorsing the concept of state sovereignty grew by means of the "military/navigation revolution." Under some specific, common rules, these states were engaged in the "militarization/state formation" race or the "prestige game" (militarism) in order to gain greater "state prestige," that is, the abstract, generalized means of threat/coercion. A sovereign state further enhanced its prestige in the "diplomatic arena" by legitimizing the annexation of territories and peoples acquired through warfare in "battlefields" as the result of their evaluation and recognition by other states. Then, the second phase of the modernization, whose full-scale development started in the late 18^th century, was staged in the "world market." A group of enterprises (modern industrial enterprises), which grew by means of the "Industrial Revolution" and endorsed the concept of private property, were engaged in the "industrialization/enterprise formation" race or the "wealth game" (capitalism) under some specific, common rules in order to gain "wealth," that is, the abstract, generalized means of exchange/exploitation. Industrial enterprises accumulate wealth in the "market" by making buyers - especially those who are commonly called "households" or "consumers" - assess and purchase their individual "merchandise," manufactured at "factories" and intended to be "sold" in the market. And now, during the closing days of the 20^th century, the third phase of modernization, which can be called the "informatization/intelprise formation" or the "wisdom game" (intellectualism), is about to begin. This phase will be staged within the "global intelplace." There, a group of organizations, which can be called "intelprises" (modern information intelprises) because they endorse a new type of the social rights that may be termed "information rights," will emerge from the "information revolution" and compete with each other under some specific, common rules in order to obtain "wisdom," that is, the abstract, generalized means of persuasion/inducement. In short, "intelprises" will try to increase their "wisdom," or what is commonly called intellectual influence in the "intelplace" by making people - more precisely, "connectives" as social networks of so-called "netizens" supported by computer networks - assess and share "sharables," that is, information and knowledge created with the intention of "dissemination" from the very beginning.

What I call the information rights here consist of a group of elemental rights:

1. an "information autonomy right," which is the right of autonomous information-processing activities, and an "information security right," which is derived from the above and guarantees the privilege of laying claim to it;
2. an "information title right," which is concerned with the belonging of the information discovered or created by a social actor to itself, and an "information priority right," which is derived from the above right and guarantees the privilege of laying claim to it after the piece of information belonging to a certain actor is shared with others; and
3. an "information control right," which is concerned with the processing of information concerning oneself by other actors, and an "information privacy right," which is derived from the above and guarantees the privilege of laying claim to it. These elemental rights, however, often conflict with each other, so it is necessary to coordinate conflicting rights properly when formulating a system designed to help people exercise them. Furthermore, as in the case of the sovereignty and the property right, it is difficult to guarantee free sharing of information and knowledge without establishing a dependable institutional regime to establish and protect the information rights. If they claim to be absolutely inviolable, however, it becomes impossible to achieve the sharing of information itself. In this regard, it is inevitable, like any other social rights, that some restrictions be enforced to regulate its unrestrained exercise when enacting the information rights. In addition, as a form of social privilege, it must be controlled by a proper administrative system in relation to other basic rights such as state sovereignty and property rights (intellectual property rights in particular). In the U.S. today, for instance, a group that proposes the greater protection of intellectual property rights, most significantly the "copyright," is confronted by another group that demands the unrestricted copying and popularization of information ("copyleft"). Another serious political issue of today involves a group attempting to enact laws that legitimate government wire-tapping and decoding as a form of state intervention to prevent computer crimes and terrorism in a digitalized society and as a counterforce to prevent such a move. Japan must be aware that this is not merely a matter for its neighbors. Both domestically and internationally, the settlement of conflicting interests that exist between state sovereignty and private property/personal information rights will be one of the most urgent assignments to be solved in order to achieve "peace," "prosperity," and "mutual understanding" in the global community of the 21^st century.

"Peace" (or "security") in this context means a condition whose actualization is eagerly sought by the majority of people in an "international society," which is a geographically expanded social system principally consisting of sovereign states and their citizens. Likewise, "prosperity" means a condition whose actualization is eagerly sought by the majority of people in a "world market," which is a geographically expanded social system principally consisting of enterprises and households. In the modern world after industrialization, especially during the days of' "Pax Americana" in the 20^th century, "peace and prosperity" have been regarded as the most desirable conditions for the entire world in this respect. And the most effective means of achieving these goals have been believed to be, in relation to the former condition, "democracy (democratic governments)" and, in relation to the latter, "laissez-faire" (free market economy). In addition to these two conditions, the third phase of modernization, which is about to start, will probably look after "conviviality" as a condition whose actualization is eagerly sought by the majority of people in the "global intelplace," which is a geographically expanded social system principally consisting of intelprises and netizens. It is very likely that distributed and open network for communication collaboration will be proposed as the most effective means to achieve this third goal. In other words, it is expected that the world order in the era of informatization will be maintained based on its three principal axes by adding "information" as the third axis to the existing two axes, politics and economy. (Refer to the chart below.)

Nevertheless, the wisdom game is still in the initial stage of development, and the establishment of the information rights and common rules remains the task of the future. "NGOs" and "advocacy groups," which have been growing rapidly in recent years, can be regarded as mere disseminators of ideals and ideologies in the nascent intelplace, rather than intelprises. The same can be said to be true of people who distribute computer software in the form of "freeware" or "shareware" and those who are trying to develop a "network publishing" system practically for free. In the past we observed that the exchange of merchandise and services in the market gradually created social actors who operate not for the act of exchange itself, however, but for the purpose of acquiring and accumulating profit and wealth by means of exchange, namely, capitalistic "enterprises." In a similar manner, the sharing of information and knowledge in the intelplace will create social actors who operate not for the act of sharing itself, but for the purpose of acquiring and accumulating intellectual influence or "Wisdom" by means of sharing, namely, "intelprises." In this sense, borrowing the terminology of Marxian economics, it can be said that "NGOs," "advocacy groups," and the other parties concerned can be regarded as "providers of simple sharables" in the preintellectualistic intelplace, corresponding to "producers of simple merchandise" who played an important role in the precapitalistic marketplace.

The three phases of modernization, which have been explained above, come into existence in chronological order, but, at the same time, they overlap each other to a considerable extent. The social legitimacy of the prestige game - that is, aggressive wars lacking the characteristics of a "just war" and the colonization race - is now completely debunked following the two world wars in this century. (Of course, it does not mean at all the disappearance of wars, especially those fought under the name of "justice," "self-defense," or "revenge". It simply means that the age of limited war, a game that was played in compliance with wartime international laws and fixed regulations such as the Geneva Conventions, has passed.) The justifiability of the "wealth game" has not been invalidated yet, even though a great number of suspicions have been raised. On the other hand, the establishment and popularization of the justifiability of the "wisdom game" are yet to be witnessed in the future.

During the transition and overlapping periods of these phases, players of the old and new games develop bilateral cooperation and complementary relations. During the initial popularization period of the wealth game, that is, the developmental stage of capitalistic industrialization, from the end of the 18^th century to the 19^th century, collaborative relations between enterprises and states had a significant meaning. Enterprises were able to concentrate on their industrial activities by relying on the state to ensure their safety and provide infrastructure development for industrialization and enterprise formation. In return, they paid taxes and supplied various kinds of high-quality merchandise and services at reasonable prices to the state. Likewise, during the initial popularization period of the wisdom game, that is, the developmental stage of intellectualistic informatization and intelprise formation, from the end of the 20^th century to the 21^st century, collaborative relations between intelprises and enterprises should play a significant role. In other words, the intelprises will be able to concentrate on their primary activities by relying on the enterprises for their economic foundation and, in return, will offer a part of their intellectual influence and a variety of beneficial information and knowledge at reasonable prices to the enterprises. Furthermore, in the capitalistic society of the past, most social relations tended to be embedded into the exchange relationship of merchandise, which took place in the market. From this experience, it is expected that, in the intellectualistic society of the coming age, many social relations, or possibly the relationship involving the transaction and exchange of merchandise itself, will be embedded into the sharing relationship of sharables, which will take place in the intelplace. In short, a greater part of today's marketplace will be subsumed within the intelplace. In other words, most of transactions made by enterprises will be targeted at "regular customers" who have had prolonged, reliable relations with them within the intelplace, rather than dealing with "strangers" who have spot transactions with them in the market. In this sense, the "National Information Infrastructure (NII)" or the "Global Information Infrastructure (GII)," both of which have been positioned as the infrastructures necessary for a new stage of industrialization in recent years, should also be regarded as the information infrastructures for the global intelplace.

The prototype of a global information infrastructure must be "The Internet," or more simply "The Net," which has shown incredible growth lately as a "network of computer networks." According to some estimates users of The Internet are said to have been increasing at the rate of 12-15% a month (approximately 400% a year!?). It is believed that the total number of users, which was estimated at 20 million at the beginning of 1994, has now reached 40 million, and it is expected to break the 200-million mark in the near future. Even though it is hard to believe that such an "exponential growth" will continue for another 5 years, there is no way to deny that the explosive popularization of computers and the "linking of computers on earth" will be achieved in merely 10 years or so, which is a very short period of time on a historical scale. Considering this fact, "The Net" itself becomes a very promising market for the transaction of various electronic products. It is understandable that a recently published book written on the business opportunities of The Internet immediately became a best seller [6]. Today, the "intelplace" supported by "The Net" is growing by taking a considerable part of the existing "market" into it. When such an intelplace expands across the entire world, it will revolutionize every aspect of not only the international economy and politics, but also people's social lives. It may even trigger a political revolution in some countries. In this respect, the "information revolution" carries with it a social significance beyond the scope of the third industrial revolution.

It is difficult to conclude that the "information rights," or the concepts of "intelplace," "intelprises" and "wisdom game," which I explained in the previous section, have established their status as important academic subjects for social sciences. The idea that another important social system exists besides the state (or an organization) or market has been proposed by various scholars in the past, however. As being the most distinguished idea among these, I would like to introduce the ideas proposed by Kenneth Boulding and David Ronfeldt.

It was the late Kenneth Boulding who recognized three major "organizers, something like social gene" in society and termed them "threat," "exchange," and the "integration." In other words, all three social organizers must be present in order for a society to formulate an infrastructure and assign roles and functions to its members.

According to Boulding, any society must have all of these three organizers. Of the three, "integration" functions as the basis of the other two and enables them to function effectively. Nevertheless, the importance of these three organizers varies depending on time, location, or social organizations. For instance, in a family or modern state, integration has a greater influence. In ancient civilizations, threat played a particularly important role. On the other hand, exchange "is a much more powerful organizer with a much wider horizon" and "developed an enormous world-wide system of exchange and specialization." In some cases, it was not easy, however, for exchange to penetrate a society greatly influenced by the threat and establish itself. In a society in which threat is dominant, exchange (and merchants and businesses demonstrating its effects) is often ignored or despised.

Boulding also proposed the concept of a "social system" (or a social "subsystem") composed of each social organizer. In biology, the latter corresponds to a "genotype," whereas the former is equivalent to its "phenotype." Social "subsystems" composed of one of the three organizers are the "exchange system," the "threat system," and the "integrative system." The exchange system serves as the economic foundation, whereas the threat system forms the basis of politics because "political power fundamentally is based on threats." On the other hand, human knowledge concerning the integrative system or the "love system" in which "the individual comes to identify his own desires with those of another," or the system that "includes persuasion, teaching and love," is extremely limited. As it stands now, it is very difficult to posit the integrative system on the basis of "sociology" as one of the main disciplines of social sciences, comparable to economics or politics.

A monograph that offers a more extensive analysis of this theory is Institutions, Markets and Networks written by David Ronfeldt, who is a researcher at RAND [7]. This monograph has just been printed and is now being circulated, so it is not possible to quote precisely from it here. With the author's permission, however, I will introduce the essential points at issue.

Ronfeldt turns his attention to the recent emergence of NGOs and advocacy groups. Organized under a regional, national or ultranationalistic framework, they have been steadily increasing their influence over public affairs in general, and nations' decision-making process in particular. Ronfeldt suggests that this new political process is different from the established pattern of interest-group politics and it raises the possibility of precipitating a radical political reform in modern society.

As a theoretical model used to analyze this process of social evolution, which is the evolutionary development of a "complex social system," Ronfeldt proposes his original "I + M + N model." In this model, he regards three factors, namely "hierarchical institutions," "competitive markets," and "multi-organizational networks," as principal forms that human beings have made good use of in history in order to form a society. During modern times, hierarchical institutions emerged first, followed by competitive markets that complemented them. In North America today, they are further complemented by networks, which have gained power as a consequence of the information revolution.

Ronfeldt also puts forth principles of social organizations, social forms founded on these principles and a social domain to which these principles and forms can be applied. According to his logic, the core domain of the "hierarchical principle" is the "state," that of the "market principle" is the "economy," and that of the "network principle" is "civil society." The term "civil society" is tentatively used in this context, however. He implies that when the network principle is fully established, a new core domain may come into existence, bringing a different, more appropriate term with it. Setting it aside, each principle expands into a specific social domain due to its uniqueness at the initial stage, but gradually influences other domains and eventually modifies or restricts them. In other words, as a society progresses, each social form and its domain start interacting with and affecting the others, instead of succeeding or replacing them. Once this process is completed, social functions become dependent not only on social forms in existence, but also on the characteristics of the interface connecting various domains and the restrictions imposed on it. In order for a society to reach a higher level with greater systematic complexity, it cannot allow any one form to dominate the others, but it must rather pursue a harmony and balance among its domains. Ronfeldt suggests that the extent of this systematic complexity will depend on a society's ability to accomplish such a harmony and balance among these essentially conflicting forms.

Speaking from this point of view, Ronfeldt's monograph is extremely useful as it contains summaries of and introductions to related literature and their major contentions, which have only been published in a scattered way since the 1960s.

By the way, in my opinion, both Boulding and Ronfeldt offer many good suggestions, but their arguments also contain a few flaws. The biggest of these is that they offer no clear distinction between a fundamental form or system of social relations and a more advanced form or system that emerges from it. One example is the distinction between simple merchandise exchange and that aimed at making profits. The latter, that is, a capitalistic form of merchandise exchange - the "wealth game" in my words - is nothing but a social activity that originates from a simple form of merchandise exchange but can be carried out only in a society in which merchandise exchange is widely accepted. The same can be said to be true with the relationship between sovereign states and the "prestige game" they engage in and the relationship between intelprises and the "wisdom game" they engage in. Like Ronfeldt, I believe that social systems such as states and markets will develop complementary relations with one another or in relation to the intelplace and, in this sense, will not easily disappear. This is different from the process in which the "prestige game" as a means of expanding and demonstrating "prestige" will disappear as a consequence of losing its legitimacy, however. The same can be said of the relationship between the general practice of merchandise exchange in the market and the "wealth game." Again it is not necessary to presume that markets will be forced to disappear once "capitalism" is replaced by another economic system. As Ronfeldt puts it, neither a state nor a market can offset its "failure" by laying the responsibility on the other. Only the principle of "networks" can complement it. Even in this case, there is a high probability that the "prestige game" or the "wealth game" will lose its significance and disappear by itself during the process of being taken over by the "wisdom game." Furthermore, even the "wisdom game" may cease to exist in the distant future. In my view, this will signify the very end of the modern civilization. It does not mean, however, the reign of states as a legitimate means of coercion and market exchange as a justifiable means of transaction, both of which modern civilization has helped to advance, will disappear completely. Nor will the sharing of information and knowledge in the intelplace and the means of persuasion and inducement be necessitated by such sharing. These systems will remain essential components of the "intellectual civilization," which will eventually succeed the modern civilization.

Japan's "ie society (a society based on the ie principle - literally, ie means "house" but here it is interpreted as a cultural principle for organizing a society)," which has been going through the process of evolution on the Japan Archipelago since the end of the Heian Period, can be regarded, in the broad sense, as a modern society. From a historical standpoint, it is based on the sharing of information and knowledge with a considerable degree of self-sufficiency and autonomy. It has developed a network-based organization with little stratification within its infrastructure - such as "ikki (a conspiracy) and "mura" (a village), or, more recently, "kigyo shudan" (a group of enterprises) and "dango soshiki" (a collusive organization) - as typical subsystems or suprasystems in the ie-type social system. One example of the former case is villages or towns in the Tokugawa Period, which served as the basis of han or the feudal domain (the great ie). The informal human network, which exists in today's work environment, can also be regarded as one of its examples. Examples of the latter include the family-oriented samurai groups (sometimes called to or a clique) in the Middle Ages and various kinds of formal industrial associations and informal collusive groups that were formed extensively for different industries after the war. In this sense, Japanese society can be characterized as a "network-oriented society" in which intelprises and an intelplace in the broad sense have functioned as the essential components of the society since the middle ages. A view suggesting that organizations such as the "sovereign states" and "free markets," which developed under modern Western societies are only imports that were later added on top of the existing base of this network-oriented society and have not become firmly rooted in Japan may be correct in some respects.

In other words, it can be said that in Japan an intelprise and an intelplace in the broad sense had already appeared and widely established themselves as one of the bases for Japanese social relations long before modern states and markets were developed here. Broadly speaking, both a market and an intelplace can be regarded as arena for "social exchange" among people. Even so, a market can be formed on the basis of temporary relations among people - provided that physical factors other than prices, such as the quality and functions of products, are already shared among the parties as the notorious assumption of "complete information" presupposes. On the other hand, an intelplace is formed on the basis of mutual trust - that is, "complete information" on human factors affecting social interaction, such as personal character, competence, and intentions - to achieve common goals such as the sharing of information and knowledge and mutual support and can exist only as a medium of collaboration to establish stable persuasion/inducement-type collusive relations and activities. Besides, such mutual reliance cannot be developed all of a sudden, but rather requires an accumulation of "jisseki (successful records)" over a long period of time before it can firmly establish itself. In this sense, the participation of new members in an intelplace can only be a gradual process and it is impossible to divide people clearly into participants and non-participants of an intelplace at any one point. Between these two groups, there is a group of people who belong to a so-called "gray zone" as apprentices or trial participants. On the other hand, a remark often heard in Japan that "no participation for people without successful records" can not always be considered an indication of the completely closed nature of its society, which leaves no room for newcomers. It is more common that the good faith of a requesting party will be accepted and participation granted some day if the party asks sincerely that "I admit that I have no previous successful records, but please accept me, nevertheless" and keeps making requests and offering gifts patiently and repeatedly.

In general, an intelplace and intelprises that operate actively within this framework serve as the flexible bases for different types of social relations and institutions, such as states and markets and eventually integrate these into themselves. In fact, it took place quite regularly during the modernization "in the narrow sense," or Westernization of Japanese society after the Meiji Restoration. On the other hand it is quite possible for social systems or social actors such as international society and sovereign states, or the world market and industrial enterprises to integrate social systems such as the intelplace and social actors such as intelprises, which are established on the principle of persuasion/ inducement through a basic collateral control mechanism, into these bases or coexist with them. America's interest in "Oriental" ideology and culture - its inclination toward "group orientation" as a reaction to "individualism" and its active promotion of the "networking" movement in particular - which has grown rapidly in recent years, can be seen as typical examples of this process. Furthermore, it is natural, recognizing the new "networking" movement in the U.S., that Japanese society is trying to reorganize and reconstruct its existing networks by examining their faults and making improvements.

As an attempt to sort out such faults and formulate a reorganization plan, I would like to point out some of the problems that I can detect in today's Japanese-style intelplace and intelprises:

1. Most Japanese "intelpreneurs" today - although they should be called "pre-intellectualistic" intelpreneurs, rather than "intellectualistic" - are "critics" with their "fan clubs." Their representatives are, if I may count them in, Ken-ichi Omae, Taichi Sakaiya, Ken-ichi Takemura and Keitaro Hasegawa, etc. They are active in organizing various support groups as generalists, instead of working in specialized fields. At the same time, they execute critical activities in a wide variety of fields by taking advantage of the mass media. In addition, there is a tendency for these people to remain in relative isolation from one another and prefer to act in completely insulated domains, rather than engaging in a debate and presenting their criticism against others. Claims and achievements made by these intelpreneurs are often published as books. It is rare for them to form academic circles, however, or to rely on periodicals such as scientific journals, organize extensive campaigns jointly, or compile data and achievements for a reference. For the future progress of intelprises, especially for the intellectualistic development of intelprises, it will be absolutely necessary to organize actors working in this field and to establish a set of rules for mutual interaction and competition.
2. The development of "citizens' movements" - or "netizens' movement," for that matter - has been conspicuous in Japan, too. Maybe they can be seen as intelpreneurs in the broad sense. There is a tendency that citizens' movement groups often try to send their representatives to the political world, however. One of the well-known examples is the great popularity of the "green party" in Europe. In the case of Japan, it is more common that representatives of these groups stand for election as uncommitted independents or political members of some existing parties, rather than forming their own parties. As Shin-ichi Kitaoka critically observes [8], however, this practice does not conform to the principle of "representative democracy," which requires the participation of "political professionals" and may even end up minimizing their influence. It is more advisable that citizens' movement bodies should support individual political professionals or political parties. Standing for election by themselves can not be regarded as an effective way to increase their influential power.
3. There is much to think about concerning the relationship between universities and enterprises. It has been so long since the slogan of "san-gaku kyodo" (collaboration between industry and academia) was first coined, but, practically speaking, little progress has been made. On the part of universities, they often claim that they should avoid associating with militaristic studies or profit-making activities and organizations, but the fact is that they remain complacent under the pretext of "academic autonomy." This "academic autonomy" supported by universities is likely to lead, in due order, to "faculty autonomy," "department autonomy," and further down to "chair autonomy, " and, ultimately, to the autonomy of individual professors and researchers. In this context, I am tempted to believe that the most widely shared ideal among Japanese "university people (Daigaku-jin)" is to create an environment in which they can do, even though poor, whatever they like for as long as they wish without receiving any instructions or restrictions from others. This is not limited to university professors and researchers. I often wonder that librarians in Japanese universities are making their best effort to preserve their valuable collection as spotlessly as possible, rather than having their books read by educators and students. Their opening hours are often reduced to accommodate maintenance work and the regulations on lending and returning books tend to get more and more strict. In addition, Japan lacks a system of true "librarians" who can be assigned to support researchers. On the other hand, the society outside universities, particularly enterprises, have low expectation that university graduates and studies done there will provide anything of much substance. I have heard a story that what enterprises would like to have is not "hakushi" (doctors), but "hakushi" (literally blank sheets, but talented people without too much specialized academic background in this case). In other words, it appears that enterprises look for students who are healthy, have many useful friends and possess high learning potential and try to make valuable personnel out of them by means of in-house education/training programs - at least until now. Should they require academic achievements from universities, they turn their attention toward foreign institutes, rather than those in Japan. It is often pointed out that there are far more cases of joint research and fund assistance being made by Japanese enterprises to foreign academic institutes than to Japanese institutes. There is also a tendency among Japanese enterprises that they prefer to carry out the entire process of research, including basic research, all by themselves. Of course, there are a small number of cases in which Japanese enterprises support research done at Japanese universities, but, as it is often pointed out, their primary motivation is to recruit more intelligent, useful students in return for such "o-tsukiai" (sociable conducts). As American authors who have made critical observations concerning the present status of Japan's hi-tech industries argue, it will be necessary in the future for Japanese enterprises to share research data with greater universal value by moving their fundamental research departments to universities and support the establishment and administration of outside research institutes, which can contribute to the realization of a more intimate relationship between universities and society. In my opinion, it is not necessarily wrong that the Japanese government makes a smaller amount of funds available for research and development programs than most developed nations. The problem rather exists in arrangements through which private sectors manage to raise and use a massive amount of funds for research and development purposes. It will be necessary to reform them in the future, so that greater results will be achieved by applying the concept of "intelprise-enterprise collaboration."
4. Another frequent observation is that, even though Japan has worked hard to achieve its goal of establishing itself as a "trading nation" or it has been making a considerable amount of foreign investment in recent years, there still remains a lot to be desired when it comes to a truly global span of business activities organized by Japanese enterprises. Especially in the latest hi-tech fields, which are expected to further advance in the future, they hold a very small share of the world market.[3] In addition, most of them are still headquartered in Japan and run by Japanese executives, and the "multi-nationalization" of their employees is yet to be achieved. Japan's "exclusiveness" or "localization" is even more evident in "intellectual" activities in such fields as thought, science, art, and sports, with the exception of a few musicians and fashion designers. It is probably true that language and cultural barriers do exist in the background. As so many people have already pointed out, Japanese people must, at one end, be dealing more seriously with the popularization of the Japanese language and the communication of information, which will help people in other parts of the world better understand the characteristics of Japanese society and its culture. At the other end, they must make greater efforts to study and practically use foreign languages, English in particular. It is desirable that the Japanese master two or three different languages from their childhood, although there is absolutely no need to disregard Japanese language and kanji characters. In fact, the adoption of English as an official language, in addition to Japanese, may be the shortest way for Japan to achieve the true "globalization" of its people, society, and language, even though this may sound too drastic. This, for example, will not only contribute to an enhanced sensitivity toward different cultures and the acceptance of other societies, but also help increase the number of Japanese at home who can serve as a bridge between different cultures and facilitate exchanges. It will also stimulate the advancement of computer-assisted translation systems. Eventually, it will lead to the development of a system that can perform translation not only between Japanese and non-Japanese languages, but also between any two languages on earth.

   Incidentally, the popularization of the Internet, which I referred to earlier, has been progressing rather slowly in Japan - a rare process that some observer called the "anomaly" of Japan. At the beginning of 1993, the popularization rate in Japan was merely one-tenth of the forecasted figure indicated by a point on the regression line, which is statistically estimated against the scale of per capita gross national product. On the other hand, those of other industrialized Asian nations such as Korea, Taiwan, Hong Kong and Singapore were all above the regression line [9]. Several reasons for this slow development have been given, including high costs for the use of communication lease lines, lack of governmental assistance, exclusive nature of Japanese research institutes, and arrogance or lack of foresight on the part of private enterprises. In addition, some also acknowledge the peculiar characteristics of communication systems in Japanese society and even those of Japanese culture itself. They claim that individualistic and liberalistic culture, especially its values placing particular importance on the individual right to freedom of expression, stand in conflict with the fundamental values of Japanese culture and consequently the system itself is avoided by the Japanese [10].

   In my opinion, this view is too one-dimensional, even though it may not be completely of the point. Without a doubt, the Internet, perceived as an element of contemporary "civilization," will find wider acceptance in Japan within the next few years. It is predictable that its applications may be different from those in the U.S., however. Besides, during the last few years, American society has reexamined its conventional individualistic values and developed a new interest in "collaboration" within a group or among individuals. Such social changes and the development of networking are now closely related to each other. In this sense, it is quite possible that Japanese society and culture will make a different type of contribution to the global advancement of the "intelplace" based on the Internet.

5. There exist some problems, however. Some of the characteristics found in Japanese communication systems arising from Japanese culture may become obstacles to activities aimed at the sharing and promotion of information and knowledge in the global intelplace and Japanese participation in the "wisdom game," which originates in and develops through such activities. For instance, communication among the Japanese is too emotional. Japanese society is not accustomed to holding an intellectual debate on some important issue according to a set of specific rules and accepting such a debate as a presentation of objective observations, even if "national sentiment" on the same issue is often exaggerated. Most rules regulating not only communication but also social activities in general are flexible, leaving a considerable amount of room at the discretion of the authority concerned. It is common that people's activities are controlled by "administrative guidance," which has no legal authority granted by enacted rules. Of course, such characteristics are not unique to Japan and can also be found, to a different extent in other societies, especially in a good part of the Asian region. In this respect, a means of persuasion that appeals to emotion rather than intellect must be quite effective in a great number of societies. In the global intelplace currently dominated by American-style society and culture, however, the characteristics found in the Japanese communication systems would probably impose unfavorable conditions on Japanese intelprises.
6. The "bureaucratic" system [11], that is, rule by bureaucrats and the social structure and public mentality dependent on them, which became particularly prominent after the Meiji Period, can be obstacles to the intelplace and intelprises. In Japan, the relationship between "bureaucrats" and ordinary people is not exactly the same as the one between the governing and the governed inherent in patriarchal systems. Rather, it resembles the situation in which affectionate mothers or "kyoiku mama" (education-crazy moms) look after their spoiled, obedient children in everything they do. "Democracy" conceived by most Japanese is, ideally speaking, the condition in which an administrative organ always pays attention to the life and welfare of ordinary citizens and looks after them as necessary. Then, should any disagreement exist, no matter how trivial it is, the people would immediately submit a "demand" to an administrative organ, which would then respond to it obediently. A system through which an administrative organ directs and regulates the people's life in every detail may not be necessarily wrong as long as social order and prosperity are guaranteed, although it may be a little annoying. Unfortunately, subjective, creative, and innovative activities, which are essential to the advancement of intelprises, are far too frequently interfered with by the present system.
7. To make things worse, excessive jealousy and "egalitarianism" found in Japanese society, which are believed to be closely associated with Japan's agricultural tradition and background, are other aggravating factors that interfere with every aspect of subjective, creative, and innovative activities organized by intelprises. They are considered the cause of "fierce and excessive competition" in which people try not to let others get ahead of themselves within the common framework founded on a specific standpoint, interpretation, objective or action. If someone should try to deviate from this common framework, he/she will be either excluded from the society or held back by force. Or, if someone should achieve outstanding results by competing legitimately in compliance with the rules of the common framework, he/she would soon become the target of jealousy and be tripped up by others. Therefore, Japanese society has, basically speaking, a tendency to systematically suppress and thin down creative ideas, innovative actions, and doubt and criticism about the status quo, particularly those concerning fundamentals, except for certain types of criticism, which are publicly recognized for their contribution to the promotion of widely accepted competitive behaviors. To the contrary, as long as it is done within a common framework, ideas and actions that may otherwise be considered dangerous, unethical, or even illegal from a different standpoint are positively accepted. It is such mores that justify common proverbs like "if you are in a bunch, you can cross the street against a red light without danger."

I have listed some of the problems that are believed to influence the development of the intelplace and intelprises in Japanese society. Nevertheless, I have little confidence in asserting their magnitude, that is, whether they are indeed serious problems or merely insignificant ones, or whether they cannot be resolved by any means or are relatively easy to overcome. To be honest, my judgment on this subject varies from day to day.

However, I am almost convinced of the following points at least. As I mentioned earlier, modern civilization has nearly reached the third phase of its evolution, which is the phase of informatization (or information-oriented civilization), after having gone through the phases of militarization (or militaristic civilization) and industrialization (or industrial civilization). In this phase, the third axis of the world order I called the world information order (the order designed to achieve conviviality through networking in the intelplace) will have great significance on the magnitude of a global order, along with the conventional order axes, namely the political order (the order designed to achieve peace through democracy) and the economic order (the order designed to achieve prosperity through the free-market economy). If so, we must study the characteristics of and the relations among these order axes in greater detail. At the same time, we must establish and control a social rights system that functions as the foundation of each order axis and devise a mechanism that coordinates the relations among different kinds of privilege. In other words, it is necessary to formulate a comprehensive legal and institutional system that concerns each order axis individually in some cases or as a whole on other occasions. As Ronfeldt's monograph, which I referred to earlier, suggests, once the third order axis is firmly established, it will affect the existing first and second-order axis, restructure the legal and institutional framework of the first two axes, and alter the concrete form of order that will be established as a consequence of such restructuring. Eventually, it is very likely that this new form will be somewhat different from the one that modern civilization has imagined in the past. It must become a courageous challenge for future intelprises, particularly those of Japan, which has long been a sub-branch of the stream of modern civilization in the western Pacific as opposed to the mainstream (European) in the eastern Atlantic and American regions, to gain wide public acceptance by constructing a clear, persuasive argument concerning these points at issue. At the same time, it will be possible for Japanese intelprises, now in their developmental stage, to firmly establish and then reinforce their foundation through such a challenge by taking one of the following two courses. The first course requires the creation of a model based on the concept of "intelprise = enterprise collaboration," which can play a front-line role for the construction of the new, comprehensive global order containing the three-order axes. The second expects Japanese intelprises to establish themselves as "global intelprises" by stepping out of the boundary of "Japanese intelprises" and taking a leadership role in the globalization of other Japanese enterprises.

1. Hiroshi, A., NHK: Denshi Rikkoku Nihon no Jijoden [Kanketsu] (An Autobiography of Japan as an Electronic Giant [Concluded]). Nihon-shuppan-kyokai, 1992.
2. George, G., Microcosm: The Quantum Revolution in Economics and Technology. Simon and Schuster, New York, 1989.
3. McInerny, F., and White, S., Beating Japan. Truman Talley Books/Dutton, New York, 1993.
4. A Crisis of Japanese Technology (Nihon no Gijutsu ga Abunai). Nihon-keizai-shuppan-sha, 1994.
5. Gilder, G., Life After Television: The coming Transformation of Media and American Life. W. W. Norton, New York, 1993. (First published as a booklet in 1990).
6. Cronin, A. J., Doing Business on the Internet: How the Electronic Highway is Transforming American Companies. Van Nostrand Reinhold, New York, 1994.
7. Ronfeldt, D., Institutions, Markets and Networks: A Framework about the Evolution of Societies. RAND, mimeo. (December 1993).
8. Kitaoka, S., Kitarubeki Seito Seiji no Jidai (The Coming Age of Party Politics). Chuo-koron, 30-39, April (1994).
9. Quartermann, J. S., "Hosts by Wealth," Matrix News, (5), 1-6 (1993).
10. Barlow, J. P., "Will Japan Jack In?" Communications of the ACM, 35 (10), 27-29, (1992).
11. Kaneko, H., Kanryo Shihai (Rule by Bureaucrats). Kodan-sha, 1993.