History of Japan

The history of Japan seems to start around 500,000 BCE, date when the earliest stone tool implements have been found. Following the last ice-age, the rich ecosystem of the archipelago apparently fostered human development rather earlier than in other geographical areas, yielding the earliest polished stone tools, and to this date, the earliest known pottery in the world. The history of Japan is then punctuated by an alternance of long periods of isolation and periods of radical, often revolutionary, influences from the rest of the world.

Post-Occupation Japan

Main Article: Post-Occupation Japan

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From the 1950s to the 1980s, Japan's history consists mainly of its rapid development into a first-rank economic power, through a process often referred to as the "economic miracle". The post-war settlement transformed Japan into a genuine constitutional party democracy, but, extraordinarily, it was ruled by a single party throughout the period of the "miracle".

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This strength and stability allowed the government considerable freedom to oversee economic development in the long term. Through extensive state investment and guidance, and with a kick-start provided by technology transfer from the U.S.A. and Europe, Japan rapidly rebuilt its heavy industrial sector (almost destroyed during the war).

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Given a massive boost by the Korean War, in which it acted as a major supplier to the UN force, Japan's economy embarked on a prolonged period of extremely rapid growth, led by the manufacturing sectors. Japan emerged as a significant power in many economic spheres, including steel working, car manufacture and the manufacture of electronic goods.

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It is usually argued that this was achieved through innovation in the areas of labour relations and manufacturing automation (Japan pioneered the use of robotics in manufacturing). Throughout this period its annual GNP growth was over twice that of its nearest competitor, the U.S.A. By the 1980s, Japan - despite its small size(1) - had the world's second largest economy. These developments had a marked effect on its relations with the U.S.A., the foreign nation with which it had the closest links. The U.S.A. initially heavily encouraged Japan's development, seeing a strong Japan as a necessary counterbalance to Communist China.

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By the 1980s, the sheer strength of the Japanese economy had become a sticking point.

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The U.S.A. had a massive trade deficit with Japan - that is, it imported substantially more from Japan than it exported to it. This deficit became a scapegoat for American economic weakness, and relations between the two cooled substantially.

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There was particular friction over the issue of Japanese car exports, as Japanese cars by this point accounted for over 30% of the American market.

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The U.S.A. also criticised the closed nature of the Japanese economy, which was marked by heavy tariff protection which made entry into the Japanese market difficult for foreign firms. Japan throughout the 1980s and 1990s embarked on a process of economic liberalisation aimed at appeasing American criticism.

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The car issue was dealt with through a series of "voluntary" restrictions on Japanese exports and by making factories in America.

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(1) Japan is small in area compared to countries like China (which has 26 times the area) or the USA (25 times) but is larger than the UK (with only 2/3 the area of Japan) and Germany (94%). In population, however, Japan is about half the size of the United States.

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