Do locals just make massive withdrawals when banks are open and cache cash around the house? I see lots of pictures of shops and vending machines in your photo stream. Surely they do not accept barter…
The problem with the unavailability of cash is that it increases the transaction costs of making purchases. Someone told me, when explaining the lack of ATMs, “we [i.e. the Japanese people... they're "one people" you know] don’t want people to waste their money”. The implication is that if cash was readily available it would be used on frivolous things.
…as opposed to the important things, like panties, DDR, and pachinko?
I can see the social argument that it encourages a conservative lifestyle (stay at home, don’t buy too many things), but that justification seems revisionist for some reason. Maybe the lack of easy banking is the legacy of something else?
If the Japanese want to encourage “conservative” lifestyles, fine. That just means the resources of that economy are more heavily used in the production of “conservative” goods/services like tatami mats, bidets and extremely high quality customer service (or whatever conservative means when describing particular Japanese preferences).
I don’t think the best way to do that is to reduce the efficiency of the whole economy by increasing transaction costs.
I meant conservative in the sense of a more spartan lifestyle. Less junk around the house. Smaller wardrobes. One tatami mat instead of a dozen lawn gnomes. Less resources spent on material goods instead of the same resources spent on conservative-flavored goods.
Austerity could be one effect of high transaction costs, but it doesn’t seem like a plausible reason. The explanation you heard seems to have been made up after the fact, sort of like someone explaining that tentacle porn stems from sea creature worship (”We are very proud of our fishing heritage”) instead of a dodge around American blue laws.
“we [i.e. the Japanese people... they're "one people" you know] don’t want people to waste their money”.
The habit of saying “we” is a direct translation from how it’s said in Japanese. While I often make the same slight that you did here – especially when I want to make my point stronger – I have to admit that it’s not too clear there’s a whole lot to be read in to this specific example. Further, it would not be totally unfair to change “we” to “me and my political party, who knows best how everyone should live their lives, “.
“Do locals just make massive withdrawals when banks are open and cache cash around the house?” -swong
Yes. Yes, it’s really that simple. It’s hard to say whether this has any real economic impact in Japan because, again, “YES!” (Hell a lot of older people still don’t trust any bank other than the BoCJ – bank of cookie jar.)
*turns to Will*
I know you had a hard time with this. You Americans walk around with your fancy credit cards thinking you can use them wherever you want – to such an extent that some you of you may not even remember what real cash feels like anymore – but we Japanese live life on much more austere principals.