The purpose of this paper is to explain the background and recent history of U.S.-Japan economic friction and discuss Korea's policy response. This paper is organized as follows. Section II will review U.S.-Japan economic friction focused on the imbalance of international accounts and industrial structure.
Section III will see the trend of U.S.-Japan economic friction such as trade goods dispute, up-to-date-technology, market open toward Japan and the change in policy response. Section IV will examine comprehensive policy cooperation and the effort of transforming policy between U.S.-Japan. Section V will investigate the closed structure of the Japanese economy, aggravating their trade disputes. Section VI will examine the background of structural agreement between U.S.-Japan and the prospects. Finally, based upon this, this paper will discuss the Korea's policy implications.