OUGD603 - Research led brief - Post occupied Japan & 'Economic miracle' research

Once I looked into post war and occupied Japan, I moved onto looking into post-occupied Japan with a focus on the economy, westernisation and industry as these heavily relate to the interest in Japan's revival following the war. This is the period in Japanese history which started after the allied occupation of Japan which ended in 1952 and aloud Japan to establish itself as a global economic and political power. By 1980 Japan become the second largest economy in the world which was down to a number of factors that had to do with American policies towards Japan, the international market, social mobilisation, existent industrial capacities and experience, and government policies and expertise, among other things.

Economy

The government at the time encouraged Japanese industrial development overseas while restricting foreign companies' business within the country. These practices, coupled with a reliance on the United States for defence, allowed Japan's economy to increase during the Cold War. By 1980, many Japanese products, particularly automobiles and electronics, were being exported around the world, and Japan's industrial sector was the second-largest in the world after the U.S. The 1964 Summer Olympics in Tokyo are often said to mark the re-emergence of Japan in the international arena, as Japan's postwar development was showcased through innovations such as the Shinkansen high-speed rail network, known in the UK as the bullet train.

Much of the early economic growth of the late 50s was spurred by the production of consumer goods for consumption by the Japanese people. While the production of these goods resulted in an everrising standard of living, it also required the constantly increasing importation of raw materials. Once the harsh reality of this situation sank in, Japan realised it must export or die. As a result, Japanese industry’s only alternative was to turn its eye toward the world market. The strength of Japanese imports was felt worldwide. In the United States, for example, Detroit’s high unemployment rate was blamed on Japanese imports.

It was interesting to see the war did benefit post war Japan in some cases as much of the militarised economy during the war was able to be converted to peacetime activity. For example, the automobile industry because out of the 11 major auto manufacturers in postwar Japan, ten came out of the war years: only Honda is a pure product of the postwar period. Three of the ten: Toyota, Nissan, and Isuzu, prospered as the primary producers of trucks for the military after legislation passed in 1936 had driven Ford and General Motors out of the Japanese market.

The need to rebuild it from scratch often led to the introduction of new technology and new management styles, which gave these companies a chance to update and upgrade themselves. Their changes were met with cheap technology and cheap raw materials. After the war was over, many of the wartime companies and much of the technology used during the war were converted to peaceful economic development. For example, machine gun factories were converted to make sewing machines; optical weapons factories now produced cameras and binoculars.

Research from http://www.iun.edu/~hisdcl/h207_2002/jecontakeoff.htm

'Economic Miracle'

The phrase 'the economic miracle' was used to describe Japan's record period of economic growth between the post World War two to the end of Cold War. By the 1990s, Japan's began stagnating and the workforce was no longer expanding as it did in previous decades, so the 'economic miracle was perceived to finish. Another factor for the end of the miracle was most likely the end of the Cold War, as originally the U.S. was concerned with the growth of the economy of Japan because there was a risk after World War two that an unhappy Japanese population would turn to communism and by doing so ensure that the Soviet Union would control the Pacific.

The miracle is split into four sections, which are as follows:

• The recovery stage (1946-1954)
• The high increase (1955-1972)
• The steady increase (1972-1992)
• The low increase (1992-2017)

The recovery stage astonished the world, earning the title of and earned the name 'Economic Miracle'. Every country experienced some degree of industrial growth in the postwar period, those countries that achieved a heavy drop in industrial output due to war damage such as Japan, West Germany and Italy, achieved a rapid recovery.

One reason for Japan to recover from war trauma quickly was the Ministry of International Trade and Industry, which at the height of its influence, effectively ran much of Japanese industrial policy, funding research and directing investment. Another reason for Japans recovery was the Korean War, as it was one of the major supporters of the United States in who they provided firearms for which helped the Japanese economy, enabling Japan to recover from the wartime destruction.

In the high increase era Japan gained support from the United States and achievied domestic economic reform, and subsequently was able to soar from the 1950s to the 1970s. Furthermore, Japan also completed its process toward industrialisation, and became one of the first developed countries in East Asia. In the steady increase time, Japan’s industrial production was decreased by 20%, as supply could not respond effectively to rapid demand, and increased investments in equipment often invited unwanted results.