THIS PAPER PROPOSES A STRUCTURE DECOMPOSITION MODEL TO ATTRIBUTE THE GROWTH IN VALUE-ADDED OF INDIVIDUAL INDUSTRIES TO THE EXOGENOUS CHANGE IN INPUT-OUTPUT TECHNOLOGY, FINAL DEMAND, AND TRADE BALANCE. THE INTERCONNECTED JAPANESE INPUT-OUTPUT TABLES OF 1975, 1980 AND 1985 ARE SUBJECTED TO OUR DECOMPOSITION MODEL TO ELUCIDATE THE MAJOR FACTORS TO DRIVE THE INDUSTRIAL STRUCTURAL CHANGE OF JAPANESE ECONOMY. THE PAPER ALSO INVESTIGATES THE RELATIONSHIPS BETWEEN THE INDUSTRIAL STRUCTURAL CHANGE AND GLOBAL DIVISION OF PRODUCTION PROCESSES.
