An interest in Japan: The political economy of Australia‑Japan investment linkages (original) (raw)

While the history of the domestic determinants of Australian trade policy has been thoroughly studied, surprisingly little academic attention has been afforded to the drivers of foreign investment policy outcomes. This is at odds with Australia's historical reliance upon imported capital, generally high levels of foreign ownership and control across the Australian economywith several notable sectoral exceptions -and major policy changes over the forty year period from the mid-1960s. Moreover, at certain historical junctures, inbound FDI has both been associated with significant developments in Australia's pattern of international trade and was sometimes politically contentious. In keeping with the APEBH 2009 conference being hosted in Tokyo, this paper explores the historical political economy of Australian regulation of inbound FDI through a specific focus on Australia-Japan investment linkages. The paper first sketches a conceptual approach to the analysis of domestic constituencies for particular FDI policy outcomes, which has been more fully explored elsewhere (Pokarier, EBHA 2007). This informs the subsequent discussion, and attempted conceptualisation, of the structures of business interests, evolving over five decades or more, that have disciplined successive Australian governments as well as their Japanese counterparts. This discipline was most clearly evidenced in the late 1980s and early 1990s when Japanese FDI was politically contentious for a time. It has also been witnessed in the subsequent public management of the bilateral relationship, and in the contemporary breadth and depth of business and other constituencies for closer economic engagement with Japan.