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Japan and management of the transatlantic crisis: international responses and domestic struggles

This article aims to examine how the structural transformations in both materialistic and ideational contexts, symbolised by declining US influence and growing Chinese voices, has influenced Japan, a key US ally in the region and China's regional competitor. Based on a neo-classical realist framework which stresses the need to analyse domestic political processes, this article sheds light on the influence of these structural transformations on Japan's efforts to formulate its new growth strategies by rearranging policy priorities and engaging in regional and international collaborations. Since the crisis took place during a period which saw the demise of Liberal Democratic Party's five-decade rule and the advent of the Democratic Party of Japan government, the article analyses to what extent the economic stimulus programmes (launched by both old and new governments, respectively) differed and assesses how they have been effective in terms of stimulating domestic demands. The article also highlights Japan's efforts under the crisis-led structural transformations to involve fast growing Asian economies in its new growth strategy and to engage in the regional financial cooperation including the Chiang Mai Initiative Multilateralisation.