JAPAN'S ECONOMIC DEVELOPMENT

To understand Japan economic boom after the war you must also look at there history. Without the creation of the industrial economy during the Meiji Japan this economic growth after postwar could have not happened. To look even closer lets 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, Page 4). The system was set up on rules and obligations on all sections of society. These systems of control helped rapid urbanization.

Education is also a factor in the economic development in Tokugawa period. Tokugawa Japan abapted Confucianism belief system from there neighbors

domestic market, but after 1973 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. This and other factors that I do not discuss in this paper resulted that in "1979 Japan automobile production overtook that of the US for the first time." (Smith, Page 136). Although Japan's high-speed economic growth was stopped they "showed

China. This became important because "one of the distinctive traits of Confucianism was reverence for education and learning" (Smith, Page 5). This spread of education was dramatic. Not Only did the knowledge seep the upper class (such as the samurai and merchants) but in order to expand business it filtrates down to the peasants and artisans also. During this period up to forty percent of boys and ten percent of girls were educated by the 1850's. These are great numbers compared to other societies. The Tokugawa period in turn developed an economy familiar to bureaucratic direction and directed by the well-educated people stated Dennis Smith.

The golden era did however come to a halt in 1973 as a result of the oil crisis. This Crisis "hit Japan Harder than other industrialized nation because it coincides with internal economic problems and with the end of stability between the world's major currencies." (Smith, Page 133). Inflation doubled in the country from 1973 to 1974. Japan economy there after began to change. Their economic growth rate slowed down dramatically. And there was also a smaller gap of technology between Japan and other industrial countries. Last of changes, 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 in 1973

began to look to 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

This started the cycle of economic development in the occupation period of Japan history. The United States occupied Japan from 1945 to1952. During the occupation the United States initial "instructions were to take no undue measures to revive the Japanese economy" (Smith, Page 64). Other policies of the occupation were the break up of 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 in 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 and I feel mainly to ease the mounting cost on the United States. Some of these changes in policy were fewer pressures for a decentralization of the zaibatsu. And by the end of the occupation a new zaibatsu emerged called the keiretsu.

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