Money, credit and Smithian growth in Tokugawa Japan
AbstractIn the latter half of the Tokugawa period economic growth, however sluggish its pace was, took place in the form of rural industrialisation and the expansion of inter-regional trade. This paper addresses the following questions: how capital was mobilised for such rural-centred growth in production and commerce, and how the quasi-capital markets worked in both the Osaka economy and in the countryside, with special reference to trends in interest rates over time, in a pre-modern setting of market segmentation. The paper will argue that although Tokugawa Japan's formal institutions were far from ideal, the credit systems did function as quasi-capital markets reasonably well within each commercial network formed through relational contracting, and that for the Smithian process of early modern growth to work, inter-regional competition mattered more than institutional maturity of the nation's market environment.
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Bibliographic InfoPaper provided by Institute of Economic Research, Hitotsubashi University in its series Hi-Stat Discussion Paper Series with number d05-139.
Date of creation: Feb 2006
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-02-26 (All new papers)
- NEP-FMK-2006-02-26 (Financial Markets)
- NEP-HIS-2006-02-26 (Business, Economic & Financial History)
- NEP-MAC-2006-02-26 (Macroeconomics)
- NEP-SEA-2006-02-26 (South East Asia)
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