This paper investigates the sequence of trade liberalization in postwar Japan and its determinants. As the Japanese government utilized the foreign exchange allocation system as a tool for the industrial policy, especially for protecting domestic industries, in the 1950s, trade liberalization was considered to give a serious impact on those industries, and designing the sequence of trade liberalization was an important policy issue. We indentified the timing of liberalization of each commodity using original official documents, and examined what factors affected on the timing. It was found that in designing the sequence of trade liberalization, the government took into account of competitiveness of domestic industries and survivability of small and medium-sized firms.
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