Political Competition, Innovation and Growth in the History of Asian Civilizations

Political Competition, Innovation and Growth in the History of Asian Civilizations

Edited by Peter Bernholz and Roland Vaubel

Do political decentralisation and inter state competition favour innovation and growth? There has long been a lively debate surrounding this question, going back to David Hume and Immanuel Kant. This book is a new attempt to test its veracity. The existing literature tends to assume that the beneficial effects of inter state competition have been confined to European history. By contrast, China, India and the Islamic Middle East are regarded as inherently imperial and overcentralised. However, these civilisations have not always been unified politically. In their history, there have been long spells of decentralised rule or inter state competition. The same is true for Japan. If the Hume–Kant hypothesis is correct, it should also apply to those periods. This volume analyses the qualitative and quantitative evidence.

Chapter 5: Advantages of centralized and decentralized rule in Japan

Gu_nther Distelrath, Ken’ichi Tomobe and John Powelson

Subjects: asian studies, asian economics, asian politics and policy, economics and finance, asian economics, economic psychology, public choice theory, politics and public policy, asian politics, public choice


Günther Distelrath PREFACE Within the course of her history, Japan has experienced phases both of centralized order and those of orientation towards decentralized rule. In the process of transition between these phases, the influence of foreign powers and military attack from without, which might eventually have led to dynasty changes (as occurred several times in China), played only a minor role in Japan up until 1945. Nevertheless the country repeatedly followed foreign examples, especially when it came to legitimizing a central government; in part it was pressure from without that caused the centralization of the political order. In this contribution I shall begin by giving a historical overview of the changes between the phases of more centralized and more decentralized constitution of the political, economic and social systems in Japan. I shall base my evaluation of the advantages and disadvantages of these orientations on the respective economic living standards of the population. Until the opening-up of Japan towards the modern international system in the mid-nineteenth century, it will be sufficient to rely entirely on internal factors, while thereafter the external influences became increasingly important. My discussion of Japan’s modern developments will first focus on the country’s departure from being a semi-colonized state1 to its becoming an imperialist power and then give a brief picture of the switch from high-speed growth and ‘catch-up’ to the present stagnation. Appraising the advantages and disadvantages of centralized versus decentralized rule from Japan’s historical experience, I shall argue that the social and economic conditions...

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