This article originally appeared on WSJ.com (may require subscription).

Japan's sluggish economy has puzzled Japanese and foreigners alike for a decade or more. How is it that a country that was until recently the world's second-largest economy, and boasts first-world levels of income, can be so mired in low growth and low productivity at home? Yet Japan's marketplace isn't a monolith, and some industries do show glimpses of what a better Japanese economy would look like. The cosmetics business is a case in point.

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