Many Japanese economists and policy makers have long talked of fostering entrepreneurship as the best remedy for Japan’s economic ills. And it is an idea that has a historical precedent here: as the nation rose from the ashes of World War II, young Japanese entrepreneurs produced a host of daring start-ups that overturned entire global industries.

Entrepreneur’s Rise and Fall

But many here say that Japan’s economy has ossified since its glory days, and that the nation now produces few if any such innovative companies. To understand why, many here point to the fate of one of the nation’s best-known Internet tycoons, Takafumi Horie.

When he burst onto the national scene early in the last decade, he was the most un-Japanese of business figures: an impish young man in his early 30s who wore T-shirts into boardrooms, brazenly flouted the rules by starting hostile takeovers and captured an era when a rejuvenated Japanese economy seemed to finally be rebounding. He was arrested five years ago and accused of securities fraud in what seemed a classic case of comeuppance, with the news media demonizing him as a symbol of an unsavory, freewheeling American-style capitalism.

In 2007, a court found him guilty of falsifying company records, a ruling that he is appealing. But in dozens of interviews, young Japanese brought him up again and again as a way of explaining their generation’s malaise. To them, he symbolized something very different: a youthful challenger who was crushed by a reactionary status quo. His arrest, they said, was a warning to all of them not to rock the boat.

“It was a message that it is better to quietly and obediently follow the established conservative order,” Mr. Horie, now 37, wrote in an e-mail.

He remains for many a popular, if almost subversive figure in Japan, where he is once again making waves by unrepentantly battling the charges in court, instead of meekly accepting the judgment, as do most of those arrested. He now has more than a half-million followers on Twitter, more than the prime minister, and publicly urges people to challenge the system.

“Horie has been the closest thing we had to a role model,” said Noritoshi Furuichi, a 25-year-old graduate student at the University of Tokyo who wrote a book about how young Japanese were able to remain happy while losing hope. “He represents a struggle between old Japan and new Japan.”