Some Lessons of Japan's Economic Development, 1853-1938

Abstract

THE ACCELERATED ECONOMIC DEVELOPMENT of Russia and China has coincided with the unexpectedly rapid postwar recovery of Japan and with a boom in economics and other social studies. One result has been a revival of Western interest in the earlier economic development of Japan and in the significance of this episode for the under-developed world.* To single out only the most obvious English-language studies in evidence, we have the treatise of Lockwood, two monographs of Smith (to which will shortly be added one of Rosovsky), and a translation of the Japanese account by Ohkawa's group at Hitotsubashi University.' A number of features of Japanese development, particularly development during the Meiji Era (i867-i9I2), evokes the special interest of conservative Western students of economic development. Japan has of course been for nearly a century the unique success story of economic development along capitalist lines in a non-Caucasian country. Moreover, her development proceeded into, rather than away from, the international economy; it was based on multilateral trade rather than autarky or bilateral barter, and was restricted until i899 by unequal commercial treaties to something very like free trade. At the same time, Japan was in no important way dependent upon financial assistance from abroad. Her development was apparently financed more largely from domestic saving than had been the earlier developments of Germany and the United States, not to mention the later developments of Canada and Australia. It moved in accordance with the natural pattern advocated by Western economists since Adam Smith-from agriculture and handicrafts through light industry to heavy industry. If we except the directly military sector (armament industries), there was little of the forced-