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Devaluation and Exports in Interwar Japan: The Effects of Sharp Depreciation of the Yen in the Early 1930s


  • Hatase, Mariko

    (Institute for Monetary & Econ Studies, Bank of Japan)


Exports are often regarded as the driving force of Japanese economic recovery in the 1930s. This paper focuses on the background of export recovery and the effects of exchange rate depreciation on the export expansion at that time. A detailed examination of the export recovery process during the 1930s reveals that the main export items and destinations changed considerably over time. This paper attempts to verify the effects of relative price decreases caused by exchange rate depreciation upon export expansion for different industries, destinations, and periods. The United States, India, and Korea are selected as destinations of Japanese export products, namely, raw silk, cotton fabrics, and heavy industrial and chemical products. Empirical analyses are conducted to measure the effects of exchange rate depreciation and income effects on exports to these different destinations. The results suggest that factors influencing real exports differ significantly from destination to destination, and that the effects of devaluation were thus not identical on exports to all destinations.

Suggested Citation

  • Hatase, Mariko, 2002. "Devaluation and Exports in Interwar Japan: The Effects of Sharp Depreciation of the Yen in the Early 1930s," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 20(3), pages 143-180, October.
  • Handle: RePEc:ime:imemes:v:20:y:2002:i:3:p:143-180

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    JEL classification:

    • N25 - Economic History - - Financial Markets and Institutions - - - Asia including Middle East
    • N15 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Asia including Middle East
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • N75 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Asia including Middle East


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