Meiji Modernization

JAPANESE HISTORY

Tokugawa Japan 1600-1878

1 Control system

2 Collapse of Tokugawa Shogunate

3 Downfall of Tokugawa Shogunate

4 Note

Meiji Japan 1878-1912

1 Introduction

2 Charter Oath

3 Abolition of feudalism

4 Political Modernization

> 5 Economic Modernization

6 Military Modernization

7 Education Modernization

8 Note - Rise of militarism

Economic modernization

old system: static, not favour to have economic development, progress
a complete break with the past feudal economic system
a means to attain the goal of Meiji Modernization: rich country
economic developments in the late Tokugawa period had paved the way for modernization
the desire to catch up with the western made the changes acceptable
need for capital to developed industry & support growing administrative expenses
financial problem
pay the daimyo & samurai
operate local & national government
pay the indemnity & debts owned by the shogunate & daimyo to the wesytern powers

methods:

avoided foreign loans (to prevent foreign influence)
forced loans from old merchant house
currency reform 1871 - Yen became the unit of currency,
standardizing financial system
monetary & tax reform
lay the economic foundation for a strong economy

Land tax 1873

victimized the peasants - imposed heavy land taxes (3% of land value)
provided 60-80% of national income
income from agricultural sector were used by Meiji government to subsidize the industrialization
unwilling to impose heavy tax on trade & industry
important element for modernization
wanted to encourage trade & industry to prevent foreign economic domination
limited resources that were available in early Meiji period
clear definition on land ownership
ensured a continuous, large & stable income for the government
budget system
social unrest (poor peasants - heavy tax - fell into debt, lost their land to rich farmers)
peasants - discontent - cheap labour force - industrialization
measures to encourage trade & industrialization
low taxation, subsidy, recruit foreign experts

Agriculture

most peasants still worked in the agricultural sector in early Meiji period
agricultural modernization
new techniques
agricultural students were sent abroad
foreign experts were invited
new plants & seeds, tools, fertilizers were imported
agricultural production steadily expanded
fishing
decline of domestic industries (eg. textile industry)
import of cheap foreign goods
increase in income of farmers created a home market - essential to industrial growth
rural discontent was pacified when the income of farmers was raised
some farmers became labour

Industrialization

essential for national strength
to end foreign monopoly in trade & shipping
merchant families - conservative
in the early 1870s, modern enterprises were new, risky & involved slow return
old merchants lacked the techniques & knowledge that were required for running a modern business
unsuccessfully tried to stimulate private investment in the early 1870s
started under the government 1870-1880
took leadership, active role, initiative, clear & strong leadership
the government contributed to the development of trade & industry
abolition of feudalism gave people freedom of occupation
many peasants became workers
maintained order & political stability
provided suitable environment for economic growth
improvement in communication & transportation network - shipping, railway
infra-structure for further economic & trade development
government imported goods & machinery and sold some of them to merchants & industrialists
subsidized private merchants in developing industries
organized trade fairs
set up technical schools
sent students abroad
invited foreign experts
At first: strategic industry which modern military power depend
Soon: production of consumer goods - textile, glass & chemical manufacturing plants
Government laid the basis for industrial growth
but long term industrial expansion must rely on private companies
Most of the government firms were running at a loss

To reduce expenditure

1880s, sale of government factories to devoted investors (ex-samurai, later Zaibatsu)
1880, government faced economic crisis
over-investment
heavy industries were expensive
many industrial projects under state operation were not profitable
financial burden
expenditure on modernization programs
payment to the samurai
cost of suppressing 1877 Satsuma Revolt
imports exceed export
inflation
need of funds for naval expansion
solution by Matsukata (Finance Minister 1882)
sale of factories to private entrepreneurs
a few private companies bought many government -owned industries
zaibatsu
few private companies that succeed in buying government industries
played a significant role in leading in industrialization
1880s, bought government industries
government economic efforts might have failed completely if such private entrepreneurs had not appeared
private management of former government industries became more efficient
after the transfer of government enterprises - co-operation & combines among big companies
concentration of much Japanese industry in the hand of a small group of companies
ran a wide range of economic activities
free economic competition, which was a condition for successful democracy was suppressed
the sale of government industries marked the alliance between government & business
later, their influence extended into different economic sectors & even politics
expansionist policy - foreign market, resources
1882, 1^st Japanese central bank was set up
economic modernization - success
fulfilled the goal: rich country
discourage foreign investment in Japan
government leaders played a large role in industrialization
developed agriculture, industry & trade
introduce large-scale enterprise based on western model
industrialized Japan not only for personal prestige, but also because of patriotism
town merchants contributed less to economic growth than ex-samurai
conservative, did not enter new lines of business

Effect:

Political:

- industrialization laid the necessary foundation of a modern state

- As the government had a strong & modern economy to rely on, the scope of power was enlarged

Economic:

- industrialization destroyed Japan's traditional agricultural economy

- New concentration of wealth & power were built up by Zaibatsu

- Large volumes of textile & silk exports helped to balance f. imports

Social:

- living standard was raised

- Social mobility was facilitated

- Industrial growth - strengthened Japan's nationalist spirit & confidence