R&D and Development Dilemma: Analysis of Japanese Electronics Industry

We study the factors which affect the Japanese economy stagnation. Using gross output data of Manufacturing from 1990 to 2015, we found among the top 10 industries, Machinery and equipment, Electrical, electronic and optical equipment, and Computer, electronic and optical products, these three industries which have negative growth are related to the GDP. We also find the R&D investment is related to the gross output in three industries. We argue that electronics industry’s decay is the reason of Japanese economy stagnation. One important reason of the dilemma in electronics industry is the stagnation of R&D investment, which shows business enterprises’ faith could be damaged for a long time.