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Account for the Rise by the 1970 s of Japan as a Global Superpower To understand Japans economic boom and rise as a global superpower after the war one must also look at their history. Without the creation of the industrial economy during the Meiji Japan this economic growth after the World War Two could have not happened. To look even closer, we should examine the period before, called the Tokugawa period, from 1630 's until the 1860 's. Smith explains that "during this period Japanese economy experienced unparalleled growth and structural change" (Smith, p. 4). The system was set up based on rules and obligations in all sections of society. These systems of control helped rapid urbanization.
Education also was a factor in the economic development during Tokugawa period. Tokugawa Japan adapted Confucianism belief system from China. This became important because "one of the distinctive traits of Confucianism was reverence for education and learning" (Smith, p. 5). This spread of education was dramatic. During this period up to forty percent of boys and ten percent of girls were educated. These are great numbers compared to other societies.
In 1869 the Tokugawa shogun was brought down and Meiji restoration began. Japan was under great change. Meiji Japan began to industrialize. This was due to the western countries that have already industrialized. It was through private investment and enterprise that Japan began this process. The backbone of industrialization were zaibatsu. (Begley, p. 86) Zaibatsu were industrial and financial conglomerates.
They were given government support including benefits from government subsidies and sell-off of government factories. The first of these zaibatsu were Mitsui, Mitsubishi, Sumitomo, and Yasuda. Growth of industrialization began slowly. In the beginning they still depended largely on United States and Europe for most specialized and worldly machinery and manufactured goods. It was not till the 1915 that industrialization began to take off for Japan. Why did this happen?
The reason is the beginning of World War I. During World War I Japan was cut off from most European manufacturer goods. This was the needed opportunity for Japanese manufacturers. Now they were able to broaden what they manufactured and move into the markets that were normally dominated by Europe. The demand for these manufactured goods ended up resulting in a net domestic product growth by 61. 5 percent between 1910 to 1920. By the 1920 's the wartime boom was over and Japan's economy went into a recession.
Yet the 20 's were important to economic development. Important changes in industry began to take place. One was a more efficient source of electric power. This was called the hydroelectric plant.
Hydroelectric plants took better advantage of Japanese geography then their pervious source of electricity. It also developed relatively cheap electrical power. With cheaper power now new industries began to develop (including aircraft and radio and electrical appliances). Smith says that beneath corporations are subcontractors and beneath them "are front parlor factories - households where parts are assembled, stamped, or cut and packed off up the production ladder. " (Smith, p. 114) As a result of the Great Depression of 1929 Japan became a more militarized state. The economy soon began to shape around miniaturization. As a result "the growing demand for goods and services from the military stimulated a growth in manufacturing industry, both in the production and in technology. " (Smith, p. 11) Yet over half of the manufacturing was in heavy industries.
Japan soon became an allied force in World War Two. After the war Japan had been defeated and there were large costs. World War II had a devastating effect on Japan and its economy. At the end of the war 8, 000, 000 Japanese were either dead or wounded (Kodak, 1972).
The United States occupied Japan from 1945 to 1952. During the occupation the United States initial "instructions were to take no undue measures to revive the Japanese economy" (Smith, p. 64). Other policies of the occupation were aimed breaking up the zaibatsu. They were accused of being the driving force behind militarism in the 1930 's to the 1940 's. Yet the zaibatsu were the center of the Japanese economic development. In 1947 there was a change in course in the United States policies in the occupational period.
This was largely due to changes in the decision-making structure of the US. (Weizner, p. 79) No matter what policies were put into motion by the occupation it was not till the Korean War that Japanese economy started to take off. It was then that the dodge line was put into effect and began to help the economy. The Korean War began in June 1950 and ended July 1953. The reason for this boost in the economy was that "Japanese became a vital source of supplies for the US forces fighting in Korea" (Smith, p. 86). This resulted in contributing "$ 930 million to the Japanese economy between 1950 and 1955. " (Smith, p. 86) The war put Japan's automobile industry in motion.
This was due to their responsibilities in repairing US military vehicles. Japans export values also began to increase on the international market. The Korean War led to a change in Japanese industries. Now policies focused on modernizing industries. Smith explains that this would "reduce cost and make Japan internationally more competitive with other countries (Smith, p. 87).
All of this began the beginning of industrial rationalization. As industries began to rationalize new industries began to develop. For example "the development of iron and steel was accompanied by the manufacture of domestic appliances and early development of the Japanese automobile industry" (Smith, p. 89). Japan also changed their management and production methods. This was largely based on the American idea of quality control. These methods led to the high quality of Japans manufactured goods.
Many of the methods were later copied by other industrialized countries. What was the governments involvement in the economic growth during this period of time? It has been argued that the involvement was significant enough. An example would be the organization MITI (Ministry of International Trade and Industry). Though MITI was formed before the war, their policies did not impact the economy till post war. One thing they did was to establish something called overland.
Basically overland were when banks would lend more money to certain firms then what they were actually worth. This was possible because the government would cover any risk involved to the bank. (Stevenson, p. 31) Dennis Smith describes the years between 1960 and 1971 as having "aura of a golden age for Japan" (Smith, p. 96). One popular explanation for the tremendous amount of economic growth in Japan was called the Japan Incorporated. This model of decision making still continues to be popular among Japanese leaders.
It is based on the idea that conservative politicians, bureaucracy, and big business all three work together in close cooperation with one another. What holds this idea together is that the main role and goal of these groups is rapid economic growth. And it is the close relationship between the three that "plans and co-ordinates grand strategy for Japan's economic development and which greatly enhances the abilities of economic bureaucracies to shape Japan's economic future" (Smith, p. 109). Kenji Hayao says that the model held truer in the 1960 's. Today Japans structure is more fragmented or sectionalize d.
Put into his own words "those who see the current system as fragmented believe that, though the cohesive, united view may have been accurate in the 1960 's "Japan, Inc. " since then has become "unbundled"" (Hayao, p. 10). During the period of 1953 and 1971 investments were high. This was a very important source of economic growth in Japan. Such investments made by private industries enabled Japan to compete within the international markets. Through these investments they could have access to leading technological knowledge. These investments were made possible through overland and conglomerates that provided capital to members of the group.
Through these investments by 1967 Japan was no longer importing its technology, yet they were researching and developing their own. (Begley, p. 117) Japan's labor intensive industries were less competitive. This was a result of newly industrialized countries (such as South Korea and Taiwan) that had much lower wages then Japan did. Government and business began to look at technology as a way to maintain economic growth. There was a change from then on in Japan's system of economic development. Before 1970 it was base on domestic market, but after 1970 exports became more and more important to Japan's economy.
An example of this is the automobile industry in Japan. After the oil crisis the world's ideas about oil developed into an idea of oil conservation. Smaller and more oil sufficient cars were becoming more in demand. These types of cars were what Japan specialized in. Although Japan's high-speed economic growth was stopped they "showed remarkable resilience and flexibility, so that by the time of the second oil shock in 1979 it was on a sound basis. " (Smith, p. 137). After 1970 Japan is maintaining a respectable constant economic growth.
Much of this growth was due to exports and purchases of assets overseas. Due to the large amounts of money in the economy banks began to loan large sums of money to finance the purchase of land and shares. Companies and foreign investments were at very high levels. Property prices were doubled in a year and then doubled again.
And customer spending was booming. Patrick Smith describes it as a time that brought "Japanese into the worlds real-estate markets, resorts, and auction rooms. " (Smith, p. 29) In conclusion, Japan's rise in economic growth and as a global superpower has been one of the most extreme developments in postwar history. Japan today has one of the largest economies in the world. When one look through their history of economic development, one first sees that much of their postwar success was contributed to a foundation formed hundreds of years before World War II. One also must realize that they have gone through many different economic changes from postwar to present. Their road to success was not always a smooth one.
They have been in many recessions. Though Japan has had such struggles they have always managed to overcome them. It is evident that by 1970 s Japan has established itself as a global superpower, it has become a country that always had its say in the matters of international importance. Certainly, the postwar development would not have been possible without the economic and social developments of the previous periods in the Japanese history, since they were used as a foundation for such a development. Bibliography Begley, Richard. Japan as a Superpower.
New York: Random House, 1998. Hayao, Kenji. The Japanese Prime Minister and Public Policy. Pittsburgh: University of Pittsburgh Press, 1993. 3. Smith, Dennis.
Japan since 1945: The Rise of an Economic Superpower. New York: St. Martin's Press, 1995. Stevenson, Patrick.
Japan: Reinterpretation. New York: Vintage Books, 1997. Weizner, Jacob. Japans Economic Development.
Michigan: Zondervan Publishers, 1999.
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Research essay sample on World War Ii Economic Growth
