8-9 - US and Japan Industrial Revolutions

ucla | GEOG 4 | 2023-10-31 20:36

Table of Contents

Background

  • expansion of global “core” to USA 1820-1920
  • and Japan 1868-1945
  • Porter’s competitive advantage was likely the cause of the rise of very Euro-distinct countries like US and Japan

    USA

    1820-1860 - building capacity

  • government protection, stimulation
  • political independence
    • used to be a resource economy for Britain pre-1787
  • 1816 “Dallas” Tariff
    • encouraged import substitution -> protected infant industries like textiles
    • opposed by southern textile exporters
  • federal government
    • common currency decreased barriers to intranational trade -> economies of scale
    • question of if slave-agrarian econ. could exist with free labor industrials simultaneously
    • subsidized agriculture
  • shortage of skilled labor
    • incentivized technological development to replace
    • motivation for industrialization w/ automation
  • liberal political ideology
    • individualism, enterprise-centric policy, free from religion and feudalism -> opportunity for migrants and growth
    • south was separate as econ based on plantation slavery and export of raw materials - racist, reactionary, conservative
    • gave corps tons of power to increase econ. and value of currency

      1860-1920 - industrial power

  • trusts, immigration
  • Union victory in Civil War
    • southern econ. of slavery, raw goods export, and hostility to import substitution stood against north’s industrialization efforts
    • Union won and allowed free wage labor for factories
  • Emergence of Trusts
    • M&A of robber barons Carnegie, Rockefeller, Vanderbilt, Stanford - reduced competition in core markets - standard oil, steel
    • Sherman Anti-Trust 1890 - split up standard oil but remained weak in regulating monopolies
    • horizontal integration - due to economies of scale at firm level and high RnD costs -> incentivized use of capital to substitute acquiring more labor -> acquire competition
  • Banks and Stock Market
    • speculative finance on futures, options, derivatives
    • risk-taking and future speculation created new industries: insurance, trading, investing, personal wealth, wealth management, consulting, etc.
  • Mass Immigration 1870-1920
    • from Europe, unskilled labor, decreased factory wages and increased labor pool willing to work for as little as possible
  • US manufacturing belt
    • Boston to chicago - waves of immigrants, labor organizing (unionization)
    • 1910 crisis in mass production

Japan

1605-1868

  • isolation, centralization
  • re-established foreign restrictions after central rule from Edo (Tokyo) established <- early colonial incursions of Portuguese and Dutch during civil war period
  • 1850s - isolation challenged by US and exporters
  • post-1868 - systematic attempt from Japan govt to industrialize to meet foreign challenge in production (Meiji Resotration)
  • limited by natural resources

    1868-1919 and 1919-1945

  • empire and militarization

    1868-1919

  • govt pushed development of new industries
  • post 1895 - industries run privately by monopolies (zaibatsu) - Mitsubishi, Mitsui, Sumitomo, Yasuda
  • Japanese colonialism in Korea, Wars with China, Russia and Manchuria (NE China, near Japan) and northern Korea <- for resources

  • 1919-1945

  • imperial policy
    • expand in East and SE Asia to acquire resources -> fuel industries & find new markets not occupied by others like US/Europe
    • Tokyo and Osaka as two main centers on south coast of Honshu
  • post-WW2 defeat -> US occupation
    • export oriented industrialization
    • zaibatsu dismantled but large firms still dominant (Toyota, Nissan)
    • Ministry of International Trade and Industry -> increased FDI in US and Europe

The Difference in US/Japan vs Others

  • political independence
  • strong central government with interaction w economy
  • Mix of redistribution and market exchange -> protect infant industries, invest in infrastructure and population
  • organized economic parts for competitive advantage (R&D, military spending, land grants, tax subsidies)