Japan’s Industrial Revolution
The Extra-European Industrial Revolution: Japan
Japan’s Unique Industrialization
Japan stands as a unique example of an Eastern nation achieving remarkable industrial progress largely independently, with minimal external assistance, while retaining its existing social structure and character.
Pre-Industrial Japan
Japan, an archipelago of mountainous, volcanic islands, relied heavily on agriculture. Cultivated land comprised only 16% of the total territory. Fishing, hunting, farming, and trade served as supplementary economic activities.
A key characteristic of Japanese society was the ingrained obedience within its hierarchical structure. This feudal society was headed by the Emperor, descending from the world’s oldest ruling family, followed by the Shogun (military governor) from the Tokugawa clan, and then the daimyo (feudal lords) and samurai (warriors).
Farmers, constituting the majority of the population, bore a heavy tax burden.
A confluence of factors led to an economic and political crisis that ultimately overthrew the Tokugawa shogunate:
- An intellectual revolution originating in the 18th century, fueled by daimyo seeking to restore the Emperor’s power.
- A burgeoning population.
- Rising product prices.
- Opening to foreign trade.
In 1853, Commodore Matthew Perry of the United States Navy entered Tokyo Bay with his squadron and, under threat of bombardment, compelled the Shogun to open trade relations with the US. Other Western nations soon secured similar privileges.
The Shogun’s perceived weakness in the face of foreign powers and the resulting xenophobic unrest ignited a movement to restore imperial authority. Led by young samurai entrepreneurs, this movement gained momentum with the ascension of Emperor Mutsuhito in 1867 and the relocation of the imperial court to Tokyo.
The Meiji Restoration (1868-1912)
The Meiji Restoration ushered in political and social reforms, adopting Western practices. The feudal system was abolished.
Japan modeled its army after Prussia’s and its navy after Great Britain’s. Financial and industrial methods were imported from various Western nations, including the United States.
Foreign experts were recruited to educate the Japanese, and Japanese students were sent to study abroad.
First Stage (1868-1885): State-Led Growth
The state laid the groundwork for economic expansion.
- Strategic Industry: Armament factories were established in Tokyo and Osaka, building upon existing infrastructure. Foreign expertise was gradually phased out.
- Transport: Maritime transport was prioritized. The government acquired ocean-going vessels in 1874. The first railway line, connecting Tokyo and Yokohama, opened in 1872. The telegraph, due to its low cost and political significance, was already operational in major cities.
- Heavy Industry: Domestic production of iron and steel ingots saw limited progress initially due to Western competition, technological limitations, and shortages of energy resources and raw materials like coal and iron.
- Mining: The government nationalized mines previously owned by feudal lords and opened new ones. By 1880, nine modern coal mines were in operation, and government enterprises produced 90% of the nation’s gold and silver.
- Construction: The state also spearheaded the construction of cement, brick, and glass factories, adopting Western building styles.
- Textiles: Cotton production, previously established within feudal domains, faced stiff foreign competition and modernized slowly. Silk production experienced significant growth with the introduction of French machinery, but high tariffs imposed by importing countries hindered its development.
The government promoted the development of Hokkaido and encouraged migration there to safeguard against Russian expansion.
This period witnessed substantial progress: the population quadrupled, and cultivated land increased tenfold. The state played a central role in the economic process, owning major Japanese companies.
Industrial development was largely financed by agricultural taxes. However, after 1880, a financial crisis, inflation, and subsequent peasant uprisings necessitated economic restructuring through deflationary measures.
Second Stage (1885-1912): Rise of the Oligarchy
The state transitioned from entrepreneur to facilitator, replaced by a powerful oligarchy.
- The government reduced public spending and the money supply.
- To improve state finances, companies founded in the 1870s were sold at discounted prices. The state’s entrepreneurial role diminished.
- A stable monetary system based on the gold standard was established.
These measures led to population growth, but not a corresponding increase in industrial labor, resulting in continued reliance on agriculture.
Japan acquired Formosa (Taiwan), Port Arthur (Lüshun), and Sakhalin Island.
Agricultural development progressed, driven by technological advancements in processing, fertilizers, and other areas. The export of agricultural surpluses, combined with continued taxation of farmers, financed industrial growth.
Tax laws favorable to business owners were enacted, and a banking system providing long-term loans was established.
Despite these advancements, the rate of industrial investment remained relatively low compared to international standards in the early stages.
By the time of Emperor Mutsuhito’s death, Japan had transformed into a modern nation with a well-developed economy.