Economic Development in Twentieth-Century East Asia

Aiko Ikeo

• Publisher: Routledge
• Year: 2006
• ISBN:
  9781134751068
• Edition: 1
• Topic: Economía
• Subtopic: Teoría económica

This collection supplies fascinating insights into aspects of East Asian economic development. It will interest scholars in a variety of related fields and provoke further research and debate.

1: INTRODUCTION

A.Ikeo

THE CONCEPT OF EAST ASIA

The concept of East Asia is itself of some complexity, and the emphasis in this concept has shifted from cultural ties to economic performance in the twentieth century. Since 1945 it seems that both politicians and ordinary citizens have began to show more concern about economic growth rather than the preservation of their original cultures or traditional values. It can be said that this trend was also stimulated by the establishment of the International Bank for Reconstruction and Development, namely the World Bank, in 1945.

The World Bank gave special attention to the success of many of the East Asian economies in achieving rapid and equitable growth, and therefore decided to undertake a comparative study of economic growth and public policy in East Asia in 1991. The resulting reports on policy issue were collected and published in 1993 under the title The East Asian Miracle: Economic Growth and Public Policy. The phrase ‘East Asian miracle’ has become vogue among East Asian scholars and development economists. We emphasize, however, that looking at East Asia from the economic perspective is really a phenomenon of the post-World War II period. It may be safely said that this trend was promoted by the World Bank itself and was not the case before it started active financing for pro-growth countries.¹ The Bank economists have enlarged the concept of East Asia by paying attention exclusively to East Asians’ rapid growth with equity.

The concept of East Asia has primarily been based on cultural identification, including Confucianism and the use of Chinese characters in writing, since East Asians did not use Western alphabets in ordinary writing. The main members of traditional East Asia were considered to be China, Korea, and Japan. With regard to religious cultures, it should not be forgotten that in Japan, Shinto and Buddhism have been at least as deeply rooted in ordinary life as Confucianism. Speaking of the influence of Buddhism on everyday life, the Japanese share many elements with peoples in Indo-China. Therefore, the case of Vietnam, adjacent to China, is very complicated. As the World Bank has realized that East Asian economies differ in many respects, such differences are even more paramount when we examine East Asian culture and tradition.

East Asian countries officially implemented their isolationist policies in the seventeenth and eighteenth centuries. But every rule has its exceptions, and each government maintained a few channels for transactions with other East Asian countries and Westerners, while monopolizing the information they obtained. In other words, the doors were closed for ordinary people to transact with outsiders. However, most citizens enjoyed peaceful and stable lives in their native lands, and they also cherished their own culture. In the nineteenth century, conditions began to change when Westerners came more often to East Asia and protested at the monopoly of trade by a few merchants. Westerners thus used force to open the door to East Asia.

The historical development of East Asia has become even more complicated since that time. We must consider not only East Asian incidents, but also the conflict of interest between Westerners and Asians. The chapters in the Proceedings aid in understanding the changes and transitions in East Asia, as it gradually became open to Westerners. In the following section, I will summarize both the composite chapters, and one excellent paper which was presented at the symposium and was published in a Japanese journal (Matsumoto 1996). In principle, the papers are arranged in chronological order.

FROM TRADITIONAL RELATIONS IN EAST ASIA TO EXTENSIVE EXCHANGE WITH THE WEST

Part I presents East Asian views of the historical changes and transition that have occurred in East Asia since the beginning of Western aggression in the mid-nineteenth century. At the symposium, two renowned East Asian scholars, one Chinese and the other Japanese, gave keynote presentations. Many participants in the symposium enjoyed their lectures, because the two share the same understanding of the modern East Asian history and historical viewpoint with many other Chinese and Japanese scholars.

X.Yu provides a typical Chinese view of the transition of the international system and relationships in East Asia from the nineteenth to the twentieth century from the perspective of historical development. Yu argues that until the mid-nineteenth century the ‘China-barbarian system’ had existed in East Asia. This system was an international hierarchical system in which China was at the apex and conferred titles of nobilities on surrounding nations, which in turn brought tribute to China. From the mid-nineteenth century, the destiny of East Asian nations was determined by the international system formed by the West, Japan, the USA and the Soviet Union. Yu believes that the gaps of national strength between nations or between regions, which produced antagonism and conflict, have been narrowed through the rapid progress and change experienced in the latter half of the twentieth century. He expects that East Asia will exert some influence on the formation of the future international system in the twenty-first century.

S.Et

, referring to Yu's lecture, considers the continuity and discontinuity in East Asia from a comprehensive perspective. Et

starts with the understanding that traditional society in East Asia was based on feudal autarkical regimes, and he discusses the process by which tradition collapsed both from inside and from outside by the force of foreign countries. Et

, then, traces the dualism of reforms and revolutions both in China and Japan, and maintains that the Japanese absorbed new things while resisting them as did the Chinese. Et

also mentions the delicate issue regarding the legitimacy of the Japanese emperor, and the mentality of Japanese in the post-World War II period. Finally, Et

summarizes ‘the light and the shadow’ in modern Japanese history from a dialectical perspective, and presents numerous suggestions for the study of modern East Asian history.

WESTERN IDEAS VERSUS CULTURAL IDENTITY IN EAST ASIA

Part II includes three papers written by Chinese scholars which also discuss both the introduction of Western ideas to East Asia, and the pursuit of national or cultural identity.² At the symposium, it was made clear that numerous important changes began in the field of economic thought, business, and education from around 1920 onwards.

T.Ye remarkably demonstrates that the 1920s and 1930s were the initial period for systematic research on the history of Chinese economic thought both in China and Japan. She carefully analyzes the historical study of Chinese economic thought in the 1920s and 1930s with reference to the biographies of several scholars. She concludes that Q.Tang's research was the highest accomplishment of this period and played a crucial role in the history of Chinese economic thought as it became an independent branch of economics in China. She laments that no such a topic on Chinese economic thought exists within the discipline of the history of economic thought in Japan. Yet, few universities in Japan even offer courses on the history of Japanese economic thought. It is interesting to note that Ye does not differentiate economics from political economy and she uses only the term ‘economies’ in her chapter.

X.Zheng makes a vivid socio-economic analysis of Chinese business culture in the period from the 1920s to the 1950s. He discusses the exchanges and clashes which occurred between China and the West in Chinese commerce from the 1920s to the 1950s, with commodities being the carriers of original cultures. Zheng examines the commercial enterprises, including Shanghai Yongan Corporation, Guangzhou Xianshi Corporation, Tianjin Central Plain Corporation, Sichuan Baoyuantong Corporation, and Harbin Tongji Corporation. Zheng argues that the awareness of information and the concept of efficiency and creativity in Western business injected vigor and vitality into Chinese business culture and brought it up to date. According to him, Chinese business ideas from the 1920s to the 1950s were characterized by distinctive Chinese features, constituted mainly by traditional Chinese moral principles such as honesty, fidelity, righteousness, propriety, assiduity and thrift. It is noteworthy that some Chinese still remember the commercial prosperity of this period.

In his challenging chapter, Q.Liu regards the May-Fourth era of the 1920s as a significant turning-point in modern Chinese history. Liu emphasizes that relevant education is able to alter the value system of society, to cultivate a new generation and to push forward social progress. Liu argues that democracy was not only the ideological weapon, but also the ideal aim of Chinese revolution of the 1920s. John Dewey and Bertrand Russell were invited to China by educational reformers to give intellectuals and young people a broad introduction to the democratic ideology of liberty and equality. Recognizing the importance of Western individualism, the reformers placed their focus on the development of individuality as a basis for sound personality in Chinese citizens. According to Liu, many students of the new generation emerging in the May-Fourth era fought against the regime of warlords and the aggression of imperialism, then put themselves into the career of social reform and revolution. Examples of the transformation of Western ideas are scattered throughout this chapter.

IDEALS, CONFLICTS, AND ‘STRATEGY’ IN EAST ASIA

Part III includes the papers contributed by scholars with different cultural backgrounds but focused on the development in East Asia during the 1920s and 1930s.

S.Kwak and H.Lee examine the conditions for economic development in Korea in the first half of the twentieth century, based on the latest results of intensive research on the colonial period. Korea was closed until the great powers started to compete for the country. In that competition, Japan won control over Korea and opened it by force. Since then, a unilateral Japanese influence has been impressed on Korea, with Japan developing Korea as a supply base for the Japanese, not for the Koreans. Kwak and Lee argue that the most important factors for economic development that Japan never introduced to Korea were will and motivation in business activity. Under colonial rule, the growth of the voluntary will of the native people was hindered by the oppression of colonial governments and foreign capital. They emphasize that mutual respect is critical in international relations.

K.Yagi, focusing on two individuals, discusses the ideals in which Japanese intellectuals believed, and the dilemmas which they faced at the outbreak of the Sino-Japanese War in mid-1937, the war which at the time was called the ‘China Incident’. The intellectuals were shocked when the puppet state of Manchukuo was established in 1931, but they came to hope that both China and Manchukuo would join the ‘Cooperative Community of East Asia’ which was supposed to be led by Japan. Yagi expresses their ideals as ‘the unification of East Asia’ and ‘the elimination of capitalism’. After 1937, the intellectuals endeavored to formulate an historical justification for the controlled economy, which had been introduced pragmatically from the necessity of supplying the war. Yagi seems to appreciate their sincere dream of establishing what could be called ‘communal totalitarianism’ in East Asia.

Based on his research into the archives of Japan's Ministry of Foreign Affairs, K.W.Radtke provocatively discusses Japan's pre-war policies toward China, which led to the ‘Hirota foreign policy’ and provided the startingpoint for all-out war against China in 1937. Radtke summarizes his views in the form of several impressive propositions. The central point in his chapter is that, although Japan aimed to become a hegemonic power in Asia, it was unable to develop a consistent grand strategy, but relied only on an array of incoherent tactical moves. Radtke argues that Japan attempted to use coercive diplomacy to conquer an economic hinterland (China) by preventing China's unification (i.e. preventing North China from being economically and politically linked to the Nanking government). He also argues that Japan's pre-war policies prevented the earlier rise of a strong and independent Asia in the twentieth century, a development which is only now beginning to take shape.

P.F.Hooper, looking at East Asia from the Pacific side, examines the development of American—Japanese tensions within the Institute of Pacific Relations (IPR) during the 1930s, and charts the evolution of relations between the two groups from friendliness to hostility. The IPR was formed under the leadership of Americans and Japanese in the mid-1920s. Its focus was initially on cultural and racial issues that were of great concern in each country, and the two groups thus shared a good amount of common purpose. However, reflecting the broader developments of the era, this sense of unity largely disappeared during the 1930s. Following the Pearl Harbor attack, the American unit declared its support of the Allied war effort, while the Japanese unit ceased meaningful participation in the Institute after the mid-1930s and concentrated its efforts on studies supporting Japan's Asian policies. Hooper's narrative deliberately. unfolds the issues that drove an ever-deepening wedge into this relationship.

At the symposium, T.Matsumoto clarified the historical heritage of the iron and steel industry which was developed by the Japanese in Manchukuo (i.e. the northeast district of China adjacent to Russia, Mongolia, and Korea). Matsumoto deliberately focused his attention on the mining and iron-manufacturing divisions of the Showa Iron and Steel Works, and traced what happened to their facilities after the Japanese left in haste for the mainland at the end of World War II. Parts of the facilities were damaged during that war and in the subsequent civil war between Chinese nationalists and communists. Some parts were confiscated by the Russian army, as the USSR joined the Allies a few days before the conclusion of World War II. Matsumoto nonetheless concluded that the damaged facilities were repaired, went back into operation in the early 1950s, and thus contributed to the economy of the district (see Matsumoto 1996).

ECONOMIC THOUGHT AND REFORMS IN DEVELOPING CHINA

J.Zhu's chapter provides a compact summary of Chinese economic policies since 1919 and the concept of equal distribution of wealth which lay behind them. He divides the historic course of change in Chinese society into three stages: the period of the new democratic revolution from the May-Fourth Movement in 1919 to the founding of the People's Republic of China in 1949; the period of the socialist planned economy from 1949 to 1978; and the period in which the policy of reform and the ‘open door’ to the outside world after 1978 led to the socialist market economy. The adoption of new reform policies was always followed by debate regarding equal wealth distribution, or ‘equity’ in the World Bank's terminology. Zhu is concerned about the contemporary world following the Cold War, in which the contradictions between the rich developed countries and the poor underdeveloped countries and the extreme disparity between poor and rich within a country have become increasingly acute social and international problems.

D.Peng contributes to the controversy regarding the role of Confucianism in East Asian economic development by arguing that alone it does not have strong influence on economic development, but that it always works as a social and cultural ethic with other more fundamental factors, such as the political or economic systems. Peng continues to maintain that Confucianism acts as a norm for people's behavior by emphasizing authority, hierarchical order, and discipline, and thus often serves as a tool for the ruling class. His point is that Confucianism enhances the ability of the government to control and mobilize the society. Acco...

Table of contents

• COVER PAGE
• TITLE PAGE
• COPYRIGHT PAGE
• TABLES
• NOTES ON CONTRIBUTORS
• PREFACE
• ACKNOWLEDGEMENTS
• NOTE ON NAMES
• 1: INTRODUCTION
• PART I: FROM TRADITIONAL RELATIONS IN EAST ASIA TO EXTENSIVE EXCHANGE WITH THE WEST
• PART II: WESTERN IDEAS VERSUS CULTURAL IDENTITY IN EAST ASIA
• PART III: IDEALS, CONFLICTS AND ‘STRATEGY’ IN EAST ASIA
• PART IV: ECONOMIC THOUGHT AND REFORMS IN DEVELOPING CHINA