The impact of the combination of clientelism and fiscal centralization is particularly potent in Japan. The Japanese Clientelist/Financially Centralized system has led to overwhelming subnational opposition party failure and LDP dominance.

BACKGROUND

As noted in Chapter 3, the Japanese party system rests on personalistic and clientelistic competition. Even the new, mixed-member electoral system, which includes a PR component, offers significant incentives for personalistic and clientelistic behavior (McKean and Scheiner 2000).

Japanese localities depend financially on the national government, and local officials see central funding as being critical to local viability. The dependence of localities on the center in Japan is captured by the phrase sanwari jichi, or 30 percent autonomy. While Japanese localities increased their independence somewhat over time, for years local taxes constituted only about 30 percent of local governmental revenues, while the remaining roughly 70 percent came from other sources, especially the central government. As the Japanese economy grew in the 1980s, local revenues reached as high as 44.3 percent, but with the collapse of the Japanese economic bubble, it dropped back down to the low 30s (Jichishō, Chihō zaisei tōkei nenkan and Chihō zaisei hakusho various years). All other revenues must come from the central government (Akizuki 1995).

From a comparative perspective, local taxes covering 30–40 percent is at or above the median for major industrialized countries and particularly high for a unitary state (Reed 1986) (i.e., the opposite of a federal system).