Economic Development of Japan
No.3 Meiji 1
PP.40-42
Second Arrival of the West and End of Edo
• US Commodore Perry and his “Black Ships” came to Edo
Bay and used military threat to open up Japan (1853-54)
• Trade with West began under unequal treaties (1858: no
tariff right, no court right), which brought social and
economic changes
• Fights over pro- and anti-foreigner forces, and pro- and antiBakufu forces began, eventually toppling Bakufu (1867)
Support
Bakufu
Antiforeigner
Black Ships
Support
Emperor
Choshu Han
Satsuma Han
Open
door
1862
1865
1866
Meiji Govt
M.C. Perry (1794-1858)
Odaiba No.3 (bakufu’s fortified island)
Hans that produced many leaders
(Alternative place names in parentheses)
Signing of Japan-US Friendship Treaty
in Yokohama, Mar.1854
Perry’s Entry into
Edo Bay 1853-54
Edo
New forts
Yokohama
Uraga
Kurihama
O-daiba
(forts)
July 1853
(4 ships)
Feb.1854 (7 ships)
PP.41-42
Fake color
photos of early
Yokohama
Resumed International Trade
• Open ports: Yokohama, Nagasaki,
E xpo rt
Hakodate, Hyogo, Niigata
• Unequal treaties with West vs. no travel
rights for foreigners
Im po rt
• Rise of Yokohama merchants
• Rapid westernization and technology
import begin
• Inflation, relative price changes, rise and
fall of industries
Trade 1876-80
0%
20%
40%
60%
To US
Silk
Tea
C otton C otton
yarn
fabrics
W oolen
goods
From UK
80%
100%
P.56
Cumulative history, Edo achievements,
national unity and nationalism
Japan’s economic growth was driven mainly by private
dynamism while policy was also helpful
Private-sector dynamism
and entrepreneurship
(primary force)
Policy support
(supplementary)
Rapid
industrialization
esp. Meiji and
post WW2 period
Policy was generally
successful despite criticisms:
--Power monopoly by former
Satsuma & Choshu politicians
--Privatization scandal, 1881
--Excessively pro-West
--Unfair by today’s standard
Meiji Government: Radical Reformist
Initially, avoid colonization by the West
Rapid modernization and Westernization
Become “first-class” nation on a par with West
• Political goal - abolish feudalism and class society;
introduce Western style constitution and parliament
• Economic goal - industrialization based on rapid adoption
of Western technology
• External goals - (1) revise unequal treaties as soon as
possible; (2) modernize army & navy, establish “sphere of
influence” around Japan
Fukoku Kyohei (富国強兵) - Enrich the country, strengthen the
military
Shokusan Kogyo （殖産興業） - Increase production, encourage
industry
P.43
P.44
Iwakura Mission (Dec.1871-Sep.1873)
--Organized quickly after abolishing hans
--Half the cabinet - Iwakura (leader), Okubo, Ito, Kido, Yamaguchi,
and other high officials (46); attendants (12), students (49);
total 107 members
Purpose 1: Start renegotiating unequal treaties (failed)
Purpose 2: Inspect Western systems and technology
Official report with illustrations by Kunitake Kume (scholar)
<Results>
(1) Valuable inputs for policy making
(2) Conflicts with “home-keeping” gov’t (leaders who stayed home)
PP.44-45
Toshimichi Okubo
(1830-1878)
• Formerly, lower samurai from Satsuma Han
• Top-down promoter of technology import
and industrialization (after returning from Iwakura
Mission)
Okubo
• Political influence—Councilor (Minister) of Finance;
then Councilor of Home Affairs
• Policy measures:
--Supporting zaibatsu (Iwasaki, Godai) to promote industries
and import substitution (shipping, etc)
--Establishment of SOEs and research institutes
--Trade & industry exhibitions (for Japanese products)
--Set up ministries, police and local governments
--Send troops to Taiwan; suppress Saigo Rebellion
Saigo
Okubo’s Back-to-Office Report after Iwakura
Mission, 1874
“The strength of a country depends on the prosperity of its people
which, in turn, is based on the level of output. To increase output,
industrialization is essential. However, no country has ever
initiated the process of industrialization without official guidance
and promotion.”
Okubo’s Proposal on Constitutional Politics, 1873
“Monarchy is a thing of the past, but we are not yet ready for
democracy. Moreover, the central government must have strong
authority for the time being to carry out bold reforms. Thus, the
most practical system Japan can now adopt is … constitutional
monarchy.
Okubo’s Proposal Concerning Promotion of the
Nation’s Fundamental Capacities, 1876
“…If we are to turn the tide around and correct the situation [of
slow economic progress, trade deficits, etc.], we have no choice
but to encourage private business and international trade by
mobilizing effective policies to cultivate fundamental strengths of
economic activities and expand commercial profit. If we do not
regard this as the duties of the government and leave the matter
to people’s own devices and simply wait for the results, will the
decline ever stop? This is the most pressing of all national issues.
Even though such policy may not be endorsed by the orthodox
doctrine of political economy, rules must be revised to respond to
the urgent needs of our time.”
Yataro Iwasaki (1835-85)
PP.45-46
三菱
• Seisho (政商) from Tosa, founder of Mitsubishi Zaibatsu
• Shipping company--grew fast with government
support (receiving gov’t ships, contract for military transport)
• Established Nippon Yusen (NYK Line), fierce battle with
Kyodo Unyu (anti-Mitsubushi company), 1883-85
• Expanded to many areas: trade, banking, shipbuilding, coal,
mining (later, more)
Mechanical factory in Nagasaki, ca 1885
Bakufu’s Steel Mill in Nagasaki, transferred to Mitsubishi in 1884
Subsidies for Targeted Industry:
The Case of Shipping & Ship Building
• Navigation Promotion Law (1896) – subsidizing
maritime transport operators if:
- Operate international routes
- Large ships over 1,000 tons
- Fast domestic ships
These targets were raised in steps offering more incentives
• Shipbuilding Promotion Law (1896) – subsidizing
building of steel ships over 700 tons (later 1000 tons)
Ship Production
Financial Structure of Nippon Yusen
Tons
Million yen
1886-90
1891-95
1896-00
1901-05
1906-10
1911-15
Revenue Subsidy
21.8
4.4
33.0
4.5
59.6
14.9
94.5
18.9
108.3
26.0
145.5
24.0
Cost
21.3
28.3
63.1
92.6
118.9
141.7
Profit
4.9
9.2
11.4
20.8
15.4
27.8
Subsidies Received by Shipbuilders
Thousands of yen
No. of
Subsidies received for
ships
Horsepo
Total Tonnage Ship
Engine
built
wer
Mitsubishi
43 6055.5
207.4 5146.4
181.8
909.0
Kawasaki
34 2379.0
96.7 1912.0
93.4
467.0
Osaka
30 618.7
30.5
478.3
24.1
140.4
Ishikawajima
2
53.0
2.5
43.0
2.0
10.0
Ono
1
12.2
0.8
9.5
0.5
2.7
Uraga
2
47.8
2.7
47.8
0.0
0.0
TOTAL
113 9166.2
340.6 7637.0
301.8 1529.1
Source: Yoshio Ando (ed), Databook on Modern Japanese Economy, 2nd ed., Univ. of Tokyo Press, 1979.
Eiichi Shibusawa (1840-1931)
P.46
From Saitama
Tomoatsu Godai (1836-1885)
From Satsuma
Super business promoters -- but they did not form zaibatsu
-Initially, anti-bakufu fighter
-Next, assistant to last shogun
-Works vigorously for MOF
(invited by Meiji Government)
-President of First “National”
Bank”
-Company builder and business
coordinator for many years
-Social contributions
(See handout or go to museum)
-Studies and builds human
network in Nagasaki
-Visits UK; realizes need to
industrialize, writes report
-In Osaka, helps to create
copper co., railroad, shipping
co., rice & stock exchanges,
cham. of commerce, university,
test centers, trading center, etc
-SOE privatization scandal
P.47
Rise and Fall of Merchants and Enterprises
Q: Who were the main drivers of Meiji industrialization?
A: All types of entrepreneurs including Edo gosho, Yokohama
merchants, Meiji zaibatsu, and company boom millionaires.
Persons
250
Millionaires of Edo period
New millionaires in company
boom period
200
New millionaires of Late Edo
150
► Japan’s industrial
revolution: from
1880s to 1900s
New millionaires
in early Meiji
100
50
0
1849
1864
1875
1888
► Survival game
was severe: many
entries, many exits
1902
Source: Computed from Miyamoto (1999）, p.53. Each line shows how many of
the new millionaires emerging each period survived in later periods.
► Japan-China War,
Japan-Russia War
also accelerated
industrialization
Constitution and Parliament
PP.48-50,226
Western style legal system and functioning parliament were
considered absolutely necessary to become a “first-class” nation
Preferred model
Government
German
(Okubo, Ito, Iwakura, constitutional
K. Inoue)
monarchy
Freedom & People’s
Rights Movement;
Fukuzawa, Okuma
Desired speed
Remark
Gradualism
(prepare during
1881-90)
Cracked down on
oppositions; H. Ito
drafted constitution
British (two-party) As soon as
parliamentary
possible
system
Tosa samurai, rich
farmers; turned
violent sometimes
<First parliamentary debate, 1890>
--Oppositions demand “Budget Cuts,
Reduce People’s Burden” (tax cuts)
--Gov’t wants aggressive spending;
policy independence from party politics
 Emperor promulgates Constitution, 1889.
Foreign policy and military modernization
(1) Revision of unequal treaties with West
--Considered impossible until Japan became Western style nation
--Legal preparation (constitution & parliament)
--Superficial imitation (eg. Rokumeikan) and too much concession
to West were severely criticized by press and oppositions
--Regaining customs rights 1899-1911, court rights 1894-99
(2) Military modernization and expansionism
--Introduction of Western military technology and systems
--Military budget (esp. battleships) was main cause of deficit
--Invading Korea: provocation, victory over China’s Qing Dynasty
(1894-95), fighting with Russia (1904-05), annexation (1910)
--Taiwan colonized after Japan-China war, 1895
Cloud above the Slope (坂の上の雲)
• Historical novel by Ryotaro Shiba, 8 vols. published 1968-72
• Lives of 3 people from Matsuyama, who shaped Meiji Japan
• Motif--dynamism of young nation; identification of one’s life
with nation’s fate
• Controversy--Japan-Russia War: Japan’s self-defense against
Russian aggression?
• NHK (Japan Broadcasting Corp.) dramatized and broadcasted
this novel in 2009-11
Yoshifuru Akiyama (1859-1930)
Japanese Army, leader of
cavalry
Saneyuki Akiyama (1868-1918)
Japanese Navy, defeating
Russia’s Baltic Fleet
Shiki Masaoka (1867-1902)
Literature, haiku innovator