Maybe thats reason why games were better in previous generations, especially in generation in which Japanese developers ruled, like 5th and 6th generation.

Oh my god yes!  The crash never actually happened in England, when I first heard about the video game crash, I thought it was made up!  Then I found out it was only in America, but they thought it was world wide.

As someone who was born in the mid-80's and grew up in the 90's, I have to say that I prefer Japanese games.

First of all, to say that an American domination would have meant more American jobs is ludicrous. All the major Japanese publisher have or had American branches that require a lot of people to run them. Some of these companies also had American development teams as well. A perfect example was Sega's now-defunct Sega Technical Institute, which had been behind Sega's American-made games. Not to mention, Sonic 2 and 3 & Knuckles were developed in America. Nintendo of America is basically a company in itself.

Second, even though they aren't quite as good as they once were, I feel like the Japanese have a unique charm to their games. I remember Retro Studios had an interesting discussion talking about Nintendo's approach to game design vs. a lot of Western developers. Nintendo and that of many other Japanese developers develop lot of games based on feelings and intuition. Retro CEO Michael Kelbaugh once explained that while working on Metroid Prime, Shigeru Miyamoto once suggested that Samus should have a bug's head. This baffled the Americans until they figured out that he meant to say that Samus should be able to switch her visor mode. Americans tend to think with more pragmatism and had it been an American developer who came up with the idea, he or she would have said "Let's have Samus switch visors". However, the important thing that came out of that is the fact that since Miyamoto was able to make that intuitive connection, he came up with an good idea to enhance the gameplay that the American developers weren't able to come up with. Other ideas that again, came from Miyamoto are the thoughts that drive them to make certain decisions. Often, they think about how a player might react to a certain situation or what the expression on the faces might look like. Also, the feeling of pressing the A button at an exact moment is important to them. This is why Miyamoto was persistent that in the first Pikmin game, the player had to press the A button every time they picked a new Pikmin.

Of course, Western pragmatism has it's advantages. Companies like Sega may have come up with games like Shenmue but the Americans and Europeans were able to figure how to make games like that sell with the 3D GTA games. Also, universal engines were a Western idea. It was a practical solution for dealing with long development times. It took the Japanese many years to catch on while some of them still haven't caught on.