Industrial Revolution : Japan
The beginning of Japan’s modern economic growth is often attributed to the Restoration of 1868, Japan’s greatest political revolution. The onset of the Meiji Ishin or “enlightened rule”, was not confined to the political sphere and led to new innovations that transformed social and industrial institutions. Since, 1600, the bakuhan regime controlled Japan until, a government was created in 1868 that restored authority to the emperor. In order to resist approaching threat of colonization by the West, the Japanese adopted the slogan of “ rich country and strong army” or fukoku kyohei.
Since the Restoration, and as a consequence of it, the Japanese industry has experienced progression in two aspects, firstly, alteration in its general character and secondly, an accelerated development of the economy. This paper aims to study these aspects along with the fundamental characteristics of The Industrial Revolution in Japan. The conditions preceding the Meiji government limited Japan’s economic potential due to its treaty obligations, while domestic demand for imports grew, supply for home produced goods reduced, ensuring a high rate of unemployment, reducing wage rates, diminishing national reserves, and a general glut in the economy. The constitution in 1889 vested both military and bureaucratic powers with the Meiji government, that established mandatory education and supported domestic industries by importing technology. Such vigor and vitality from a nation could be supported with help of its inherent strong institutional capacity reflected through its wealthy and intellectuals as well as, the government which developed a nationalized banking system to standardized currency. Also, the central focus of the policies adopted by Meiji Ishin reflect the outward thinking and inward strengthening abilities, reinforced by extensive sea and land networks built for integrating national markets.
Japan’s imperialistic acquisitions began with Taiwan’s quest in 1874 and ended with USA’s victory in the Pacific war. Nonetheless, Meiji government introduced fundamental principles of civilization, human rights and enlightenment. While, Britain’s economic growth led to the a new democratic state and liberal society, Japan’s industrialization was governed by a military regime and people were ruled by an absolutist imperial system. While capital investment in research and rationalization of functions boosted productivity of certain sectors, the agricultural sector declined. Following which, the industrial boom and the agricultural depression of 1920’s created a shortage of labor, as farmers migrated to cities, productivity gaps widened and wages pressured.
Treaty and Tariffs:
Due to previously signed treaties, Japan was compelled to open her ports to Western nations and import duties were controlled at low rates. As a repercussion, Japan adopted a Free Trade policy, unknowing of its pros and cons, albeit at the pleasure of the western Powers. Excluding the diplomatic factor of the loss of autonomy over trade and depleting national reserves, low tariffs facilitated import of machinery that favored industrialization in the nation. Efforts in accumulating technology and investment in capital equipment enabled new industries to birth, forming the garb of protection the Japanese economy needed. The Meiji government successfully retained tariff autonomy partly in 1899, and by 1911, Japan grew based on heavy, chemical and manufacturing industries.
While Japan remained a nation in isolation, a sustained means of self supply had been systematized, labor was highly specialized and division of labor was practised across occupations. However, enormous demand grew for all things European, articles of luxury were necessitated, unforeseen by the Japanese producers. A trite Japanese saying is, “What the upper class like, the lower learns to like still more”, the West forming the upper class while the Orient was viewed as the inferior, lower class. The popular rush of European products dominated the market, and local industries collapsed, occupations were abandoned, and skilled labor became unemployed. A new class of widely differing popular tastes emerged, while the local manufactures remained clueless about the production process and utterly powerless to
not digress to traditional protection policies and in the face of European technology, small Japanese manufactures could not compete while, bigger manufacturers could not prevail benefits of economies of scale since monopolies ceased to exist with the fall of feudalism. The self sustaining system of support and supply failed with the introduction of modern machinery and expensive warfare. Either the political and social conditions were to comply with the production of the industrial system, or the industrial system had to transform itself to suit the new political and social atmosphere. The former represented retrogression while the latter meant progress, symbolized by the Industrial Revolution.
The objective of the Restoration was to promote national prosperity and enlightenment, in essence to impart education to all. The intellects were appointed to observe civilized countries with the aim to adopt their technology, social, industrial, political institutions and transplant this newly obtained knowledge through Japanese soil.
Strong Institutional Capacity:
Meiji Japan build a strong empire, with a strong domestic institutional capacity to respond to shocks in the external economy. The wealthy and intellect collaborated to benefit themselves and the industrial system. Enterprising ventures by individuals in the railway industry, cotton mills, paper factories etc. gained importance as private institutions. Private manufacturers rose to meet the demands of Japan, supported by the Meiji government. Shokusan Kougyou (industrial promotion) was not only propagated as a government slogan but also found its way as national motto, which helped unify the nation. The Meiji government was forward thinking and recognized the need to learn technology and accumulate investment capital for the short term benefits of monotsukuri (making things). However, today the monotsukuri culture of Japan has been defeated by China’s economic dominance in the Asian arena, and like other Asian nations remains susceptible and dependent on foreign investment rather than on domestic technology, human resources and production systems.
Policy goals of the Meiji Government:
Once, Japan opened her ports to the world, the national priority immediately shifted towards security and defense, to deflect the Red scare colonization and protect its national sovereignty. These goals are summarised by the following slogan, “rich country and strong army” or fukoku kyohei. Japan’s youth desired to be at par with other economies and nationalism grew for the following half a century or more, ending with the Pacific War. The Meiji Government concerned itself with the following issues:
● Economic policies of Industrialization such as industrial promotion or hokusan kougyou
● International policies of expansion such as the Korean expedition or seikanron
● Political reforms, few examples are noted in the “Proposal for a constitutional government” that necessited a constitution and a parliament.
Toshimichi Okubo, one of the member of the Iwakura Mission, wrote “Proposal for a Constitutional Government”. Although, democracy ideally is much superior to a monarchy, in reality, it disintegrates which may lead to oppression of the poor, witnessed in the French Revolution. a democratic system will not be functional since Japan in comparison to England, is only ‘semi civilized’ and cannot rid itself of traditional customs of feudalism. Hence, policy making, implementation and reforms would only be possible if facilitated through the Central Government. The paper recommended Japan to introduce a constitutional monarchy, governed by the emperor until Japan’s transformation. The debate between economists over the order in which democracy and economic development will continue, however the real argument to be considered are the set priorities and mutual goals, in Japan’s case, of economic growth.
The Meiji government steadily acquired control and management of different kinds of factories. A paper factory was established to print paper currency for easy monitoring of transactions. This necessitated sulphuric acid, thus, a factory for its production was initiated, one by one, new factories began to emerge. Meiji Japan successfully concentrated capital by issuing Bank regulations and establishing national banks. The government encouraged factories with machinery for silk and cotton replacing manual labor, and employed these laborers for the construction of Japan’s first railway line between Tokyo and Yokohama.
First decade after the Restoration, Japan began export of natural products and raw materials, while manufactured goods were still imported from the west, first waves of import substitutions emerged in the domestic market.The introduction of a monetary system, railway line, nationally chartered banks, joint stock company system and new weights and measures for Japan, transformed its market economy. The success of import substitution in the cotton industry and the shift to export-oriented production allowed Japan to escape from the tyranny of British goods, since Japan exported primary commodities and imported manufactured goods. By the 1890s, Japan strengthen ties with its Asian neighbors and began to export cotton yarn and clothes ensuing regional cooperation in the region.
Today, Japan is the third largest economy by GDP, this cannot be solely attributed to its Free Trade Policy but due to her vigor and vitality as a nation through the Industrial Revolution. Even Though, her self sustaining system of support and supply had failed with the introduction of modern European machinery and expensive warfare, Japan is unlikely to adopt a protectionist policy in terms of its trade. Having secured its tariff autonomy through revised treaties with the West, she is certain that a free trade system is imperative to the nations development. Also, Japan remains “ rich country and strong army” or fukoku kyohei attributed to the acceleration and transformation of its economy, initiated by the Meiji government’s support in the import in technology, spread of mandatory education, and establishment of networks and industries for integrated markets.
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