Chapter 9: Why Japan Succeeded and China Failed
9. Why Japan succeeded and China failed This chapter examines the two major hypotheses advanced to explain China’s failure to generate modern economic growth (MEG) after the opening to the West while Japan succeeded. One hypothesis is related to China’s difficulties in absorbing modern technology because of its unfavourable conditions as compared to Japan (Minami 1994; Eastman 1988). The second hypothesis is related to the difference in the role of government, because in contrast to the Meiji government which took a proactive role in facilitating industrialization, neither the Qing nor the Republican government in China provided the conditions vital for the private sector to absorb Western technology and generate modern industrialization (Perkins 1967). INITIAL ECONOMIC CONDITIONS This section compares the level of economic development of China and Japan during their initial periods using the following key indicators: (1) per capita gross domestic product (GDP); (2) the share of the primary sector in employment and output; (3) the growth of agriculture; (4) their respective degrees of commercialization and urbanization; (5) their industrial development; and (6) the share of their transaction sectors in GDP. Japan’s transition period lasted from 1868 to 1885 (Minami 1994) but since statistical data are only available for the year 1887 it is reasonable to take this as indicative of Japan’s initial conditions for industrialization (Ohkawa and Shinohara 1979). China’s transition was much longer and lasted, as stated previously, from 1842 to 1949. Around 1700, Japan’s GDP per capita was much lower than that of China. However, it...
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