From Japan with Love

Japan is a fascinating country of economic and business prowess, rich culture, technical wizardry, spatial conundrums and contradictions. Japan held onto the title of the world's second largest economy for more than 40 years from 1968 to 2010. Tokyo, Japan's capital city is the world's largest metropolitan area, with a population of 32.5 million people. Despite having an area slightly bigger than Germany and smaller than California, Japan is the world's tenth largest country by population, with 127.3 million people. Japan's reconstruction of its nation to become the great economic power in less than forty years after the defeat of World War II has been a somewhat remarkable exception in modern economic history. Before the defeat in 1945, all of Japan's strength was spent on gaining power through war and, as a result, it led to destruction. A high proportion of the industrial and commercial buildings together with the equipment they contained had been destroyed, and much plant and machinery formerly used in production for the civilian market had been scrapped to provide metal for munitions. Due to this concentration of power used in war, the surviving Japanese people from the war were left with chaos, starvation, and unemployment when returning to their country. With almost a quarter of its nation's housing accommodation destroyed, the Allied Occupation Forces came to rescue the devastated country. Although Japan was left with wastes and ruins of factories and infrastructures, Japan was able to reconstruct its economy from a fresh start by building on its prewar economic experience and gaining knowledge from the rest of the world. To understand Japan's postwar economic growth, we must consider its economic development and history during the 1800s to early 1900s. At the starting point of modern economic growth when Japan became an open economy in the late 1800s, a huge gap existed between the Western Powers and Japan, due to Japan's historical isolation from the rest of the world. However, Japan was able to make the gap smaller by agricultural technology developed during the Tokugawa Period and also, the central government during the Meiji Period carried out a series of modernization measures and it enabled Japan to import technologies and ideas from the Western countries easier. The heritage from the Tokugawa Period, together with the foundations for economic growth developed during the early Meiji Period, enabled Japan to propel the economy on the road to modern economic growth over a period of about twenty years starting from the mid- 1880s. By 1900, Japan was ready to expand its empire in a larger scale since Japan being heavily populated with small resources had to rely on trade to supply its basic needs it lacked. Until the defeat of World War II, Japan has clearly become to be one of the most powerful countries both economically and militarily and its basic factors for growth had been prepared. These remarkable achievements during the postwar period provided the basis and skills for the economic miracle after the destruction in 1945.