ABSTRACT
This chapter considers the historical origins of these institutional practices and the role they might have played in the establishment of industrial production in Japan. The economic and political power and influence of the zaibatsu meant that they acted as the channels whereby capital and scarce educated manpower were directed towards the modern industrial sector, and it is in this that their chief contribution to the speed and pattern of Japan's industrialisation lay. The chapter describes how this operated in the labour market, but control over sources of finance was in many ways the key to zaibatsu organisation and to the ability of group companies to expand in capital-intensive areas. Zaibatsu companies were in a strong position to raise funding through shareholders. Zaibatsu banks were able to provide group members with privileged access to finance and commercial services. The progress of Japan's industrialisation in the late nineteenth and early twentieth centuries involved increasing integration into the world economy.
