Both countries had adopted the ideology of Confucianism, which gives emphasis on knowledge and education, and became their guide to garnering economic benefits. Employing Confucianism, people in both countries are being classified based on their knowledge and skills to determine their prospects of employment. The two countries differ so much when it comes to economic system, price system, employment system and public finance. After WWII, Japan’s economic growth had been rapid, having been successful among the market capitalist economies in the world, whereas, China’s economic system consists mainly of the Chinese Communist Party (CCP), whose influence over all levels of economic and political activities are apparent. Japan imports fuel and energy resources, and in their thrust to excel in the steel industry, on the process, their environment had become extremely polluted. China’s industry also includes steel, but they are equally strong when it comes to agriculture which is fully controlled by the government, to undertake the feeding of the large population of China.
Prices of commodities in Japan are being determined by the demands of consumers as prescribed under the consumer sovereignty law in Japan’s market system. However, in the case of China, consumer demands do not establish the pricing system, but the government of China first takes into consideration the costs of productivity, potential profits and taxes. The labor system of Japan exists on a relatively uniform wages, which had proven to be effective for them because it brought about higher rates of labor productivity. In the meantime, China maintains the “eight-wage” classification system, in which the workers’ wages are dependent on their skill level, class one being the lowest (Chan, 2002). The market forces are overridden by government action in determining wages. Income distribution caused wider degree of disparities