Economic Growth in Tokugawa Japan

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Economic Growth inTokugawa Japan

• Michael Smitka
• March 2001
• Economics 297 Presentation

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Mid-16th Century Han(countries)
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Issues

• was Japan poor? -- standard of living
• was the economy static -- growth process
• institutional, other legacies
• Curiosity merely understanding Japan (1600-1868)

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Models

• economic growth
• Solow one-sector model
• Lewis-Fei-Ranis two-sector model
• Solow model is simple production function Y
  f (K, L, N, tech) N is land
• technical change is core of Solows work
• capital deepening is a key factor (incl human
  capital)
• population growth can eat up gains

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Other factors besides hard tech

• organizational institutional change are both
  underrated
• Smithian growth through specialization and
  trade
• government provision of infrastructure, other
  public goods
• development of business networks and accepted
  practices in markets

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Demographics

• population growth can swamp positive factors.
• indeed, for most of human history standards of
  living changed little
• how about Japan? -- and if not, why?

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Basic Historical Overview

• breakdown of old govt continual warfare during
  1500s
• spread of irrigated rice varieties
• diffusion of civil engineering techniques from
  China
• 1540 arrival of Francis Xavier diffusion of
  muskets
• unification under Oda Nobunaga Toyotomi
  Hideyoshi
• neither was able to set up a system that outlived
  them
• enduring unification under Tokugawa Ieyasu (1600)
• Tokugawa bakufu officially founded in 1603
• Ieyasu named shogun

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Unification ?

• multiple kuni (country?!)
• each headed by a semi-autonomous daimyo (lord)
• variations in laws, economic structure
• roughly 250 political-economic units remained

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Politics and the economy

• how maintain the peace?
• impoverish your rivals
• keep hostages
• alternate attendance system
• every-other year in Edo (modern Tokyo)
• families (heirs) must stay there
• mandated high expense levels
• by 1700 Edo had a population of over 1 million

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Growth stimulus?

• Tokugawa control system had
• implications for macroeconomic resource flows in
  a two-sector context
• implications for commercialization and
  monetization of the economy
• Lewis two-sector model forced flows?

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Government role

• the Edo bakufu fostered navigation
• port and lighthouse development
• maps etc. all by around 1720
• formal financial markets promoted
• rice futures market in Osaka by 1720
• transferring money in place of in-kind taxes
• insurance markets (esp. casualty)
• local (rural) finance by 1800s

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Market-oriented economy

• especially intense development in several regions
• cash-crop farms around Osaka (hence farmers
  bought food....)
• large urban consumer market
• commercial elite for whom political advancement
  was foreclosed (cf. English Dissenters)
• education spread.
• ukiyoe were for mass-market (wedding presents)
• lots of agricultural handbooks - 200 titles in
  print

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Specialization by the kuni(export products)

• Silk, cotton, salt, lumber, paper, fish
• Some regions largely industrial
• Seasonal proto-industry often accompanied by
  regional migration
• Both men women active in wage labor outside the
  home

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Technical Change

• hard to measure industrial level but
• very rapid ability to reproduce industrial
  revolution technology
• clear shifts in agriculture
• diminishing returns?
• demographic evidence mixed for whole country
• but not true (??) for advanced regions

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Standard of Living

• transformation of consumption
• various rough fibers replaced by cotton silk
  worn by more than just elite
• new (and better foods). peppers, sweet potatoes
  / taro, corn, etc.
• new and better housing tatami mats off the
  ground
• vast increases in protein-laden soybean-related
  consumption (miso, soy sauce)
• Education
• Literate society, perhaps more so than England!
• Vast outpouring of books, circulated through
  lending libraries
• Even nascent western studies, esp. in 1800s

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Shipping Routes after 1720
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Area of Indica(short-grain)Rice
Cultivationearly 1700sdarker hatching
indicates greater cultivation of indica rice
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Kawaguchi Ironware
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Zaguri (silk weaving machine)
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Loom (karabikibata) c. 1770
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Spinning Silk
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Whale Processing Factory
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Population Growth Rates
Region 1798 1804 1828 1834 1846 98-46 Kinki
93.5 93.5 0.0 Tokai 100.1 106.6
6.5 Kanto 85 86.6 1.9 Tohoku 86
88.7 3.1 Tozan 106.1 1798 110.1
3.8 Hokuriku 105.3 -1834 117.6 11.7 San'in
118.8 120 129.9 132.7 11.7 124.8
4.0 San'yo 106.8 109.9 119.8 121.8 14.0 120.2
9.4 Shikoku 111.7 114.9 123.8 126.1 12.9 126.8
10.4 Kyushu 105.3 107.3 111.3 112.2
6.6 113.8 6.1 1721 100 Kinki,
Tokai, Kanto, Tohoku, Tozan all fell. 48
years Hokuriku slow growth selected regions,
old data
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Agriculture Outgrows Population
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Tokugawa Population Agriculture
Area Yield Yield Pop Arable
Farm per per per Year (mil)
Land Output Pop Pop Area 1600 12.0
20.7 19.7 17.25 1.64 0.095 1650 17.2
23.5 23.1 13.66 1.34 0.098 1700 27.7
28.4 30.6 10.25 1.10 0.108 1720 31.3
29.3 32.0 9.36 1.02 0.109 1730 32.1
29.7 32.7 9.25 1.02 0.110 1750 31.1
29.9 34.1 9.61 1.10 0.114 1800 30.7
30.3 37.7 9.87 1.23 0.124 1850 32.3
31.7 41.2 9.81 1.28 0.130 1872 33.1
32.3 46.8 9.76 1.41 0.145
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Specialization in AgricultureCotton Production
Koga county, Harima han near
modern Kobe Irrigated Year fields Dryland Re
claimed Total 1801 0.4 13.7 28.5
8.2 1807 0.6 15.1 25.2 8.2 1813 3.0 41.5
36.9 17.3 1822 4.3 38.6 36.8 17.4 1832 0.5
34.5 34.8 13.4 1842 2.2 38.6 36.9 16.2 1847
1.5 35.2 35.2 14.5 Note I find it
surprising that any irrigated fields were used
for cotton instead of rice! In the 1880s imports
led to a sharp drop in domestic output, and
production ceased by 1900.
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Shifts in Family Structure
Average for Selected villages Suwa
Region, modern Nagano Prefecture Avg.
Household Size Avg Couples per
Household Year Nishiko Yamaura Nishiko Yamaura
1671-1700 7.87 8.55 1.97 1.83 1701-1750 6.14
9.93 1.41 2.34 1751-1800 4.66 6.94 1.32 2.05
1801-1850 4.22 4.73 1.25 1.37 1851-1870 4.31 4
.48 1.20 1.30
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Osaka as an Entrepot (1714)Principal non-Rice
Imports / Exports
Imports Exports Marine products 20.2 Oil
beeswax 36.4 Agricultural items 19.5 Clothing
textiles 25.2 Clothing textiles 15.4 Misc
tools 7.5 Oilseed 12.9 Misc
exports 7.3 Mining products 7.5 Processed
food 6.1 Fertilizer 6.4 Accessories
decorations 5.8 Wood products 5.9 Lacquerware
pottery 4.6 Misc Imports 4.1 Seedcake
(fertilizer) 3.4 Tea tobacco 2.8 Furniture 0.
5 Tatami 2.0 Weapons 0.5 Kyoto
crafts 0.9 Arts crafts 0.4 Total (Ag
value) 286,561 kan Total 95,800 kan
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Extent of Cotton CultivationJapan remained able
to shift land out of food crops
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Growth of a National MarketRice Price Movements
Converged in the 17th Century
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Structure of National Output 1874

• shortly after opening to the West
• before significant structural change from
• new technologies
• convergence of domestic international prices

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