ABSTRACT
In 1867, when this story of economic development begins, Japan's economy was given over predominantly to small-scale agriculture and to household industry. She then lacked modern communications and modern educational, administrative and financial systems. Factories driven by mechanical power and industrial equipment of the kind with which the leading Western countries had been familiar for the best part of a century were novelties. She had only slight experience of foreign trade and of the operation of an ocean-going mercantile marine. It is true that at that time even in parts of the Western world modern industrialism and modern transport systems were comparatively recent innovations, and that the influence of the great technical discoveries of the eighteenth and early nineteenth centuries had still not completely shattered the old economic forms. Yet the contrast between Japan and the West lay not so much in the fact that Japan was a late starter in the development of the new economy, but rather that the conditions precedent to such a development did not seem to be present in her society. There had been no expansion of overseas' commerce such as preceded the industrial age in Great Britain. The minds of her people had not been subjected, as in Europe, to the philosophic influences which had weakened the forces of custom and tradition, had made them receptive to the discoveries of science, and had brought about the great liberation of individual human energies that had occurred at the end of the eighteenth century. There had been no accumulation of scientific knowledge and no widespread appreciation of the scientific method as applied to the processes of production. Japanese society in the later years of the Tokugawa era, had certainly not been stagnant and, as we have seen in the first chapter, the older forms of social and political organization were then disintegrating. The changes were, however, very different from those that brought to an end the ancien régime in Europe and led to the emergence of liberalism in both the economic and political spheres. Thus in 1867 the Japanese economy was not merely backward when compared with that of the chief Western nations, but the foundations for a new era of expansion seemed to be ill prepared.
