sealPurdue Business Tips

June 1995

Trade imbalance is linked to myths of Japanese quality

The reason the trade imbalance between the United States and Japan has endured, many experts say, is because Americans regard Japanese products as higher in quality than their domestic counterparts. But Ray Eberts, professor of industrial engineering at Purdue, and his wife, Cindelyn, say Japanese quality is a myth, and that American-made products are just as good, if not better. The Eberts spent three months in Japan, and when they returned to the states they felt compelled to write their new book, "The Myths of Japanese Quality." In the book, the couple outline 10 myths -- six having to do with management techniques and four with products -- that Americans have bought into. For example, the Eberts found that in 1993, a Honda was almost 13 times as likely to be recalled as a General Motors car.

"A few years ago, it was probably true that Japanese products were better than American," Ray Eberts says. "But that's no longer true. Consumer Reports is one of the few publications that consistently ranks Japanese products higher than American products. But that publication is based on consumer anecdotes, and consumers are still caught up in the myth." Eberts isn't into Japan-bashing and doesn't argue that all Japanese products are poor quality. "What I hope Americans will realize is that our products aren't as bad as we think," he says. "The myth of Japanese quality is really a sign pointing to another myth -- the myth of poor American quality." CONTACT: Ray Eberts, (765) 494-5429; Internet, Copies of the book are $24.95 and are available from Prentice-Hall Inc., (800) 382-3419.

Governments are international tourism's biggest obstacle

Although tourism is one of the largest industries in the world, it could be even larger if government-imposed obstacles such as tariffs were reduced or removed, says William Theobald, Purdue professor of recreation studies. "There are enough barriers to international tourism as it is, from language to a lack of financial resources," he says. "None of these is as restrictive as governmental barriers" such as passport and visa regulations, import duties and departure taxes. Theobald says reducing restrictions on tourism would foster "faster economic growth, greater employment opportunities, increased consumer confidence, enhanced political stability, and greater progress toward world peace." CONTACT: Theobald, (765) 494-3153.

Japanese pay a high price because of illegal cartels

If the United States really hopes to export more goods to Japan, it first must get that country to crack down on its illegal monopolies and cartels, says a Purdue assistant professor of political science. Mark Tilton says it's the informal and illegal cartels in Japan that keep imports out of that country. He says the Japanese government indirectly and sometimes directly supports these cartels. Tilton says Japan has made token attempts at cracking the cartels, but has not really attacked the core of the problem. He says Japanese cartels are so strong that, for example, Japanese manufacturers buy overpriced, domestically produced petrochemicals even when imports average more than 40 percent less. Tilton recently made a presentation at the symposium, "Japanese Public Policy: Perspectives & Resources," in Washington, D.C. The symposium was sponsored by the Japan Documentation Center of the Library of Congress, which helps Americans gain access to Japanese public policy information. CONTACTS: Tilton, (765) 494-4176, or Mindy Kotler, director of the Japan Information Access Project, (202) 332-5224.

More on-campus interviews bode well for grads

The good news for students entering the job market is that the number of on-campus interviews is picking up, indicating an increase in hiring, says Richard Stewart, director of the University Placement Service at Purdue. Stewart says on-campus interviewing increased this year for the first time since the 1988-89 school year, with 658 companies conducting interviews, up from 554 last year. Larger firms such as General Motors have returned to campus, and the number of smaller firms, such as personal-computer and consumer electronics companies, is growing as well. In high demand are graduates in computer science and engineering, such as programmers, systems analysts and designers of wireless communications products. Stewart says jobs eliminated by downsizing at large companies may be offset by job growth among smaller companies. John McLaughlin, interim dean of Purdue's Schools of Engineering, says the turnaround in the economy may be the reason why this year was far better than last year in terms of job offers to Purdue's mechanical, electrical and civil engineers -- a large portion of engineering graduates. He says civil engineers for infrastructure development and environmental services are hot again. CONTACTS: Stewart, (765) 494-3981; McLaughlin, (765) 494-5346.

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