The Great War of 1914-18 and the Post-War Decade
THE Meiji era coincided with the period in which Japan laid the economic foundations of a modern State. The accession of the new Emperor, Taisho, came only two years before the outbreak of the Great War of 1914-18, which marked for Japan, as for other countries, a great dividing line in economic history. During the whole of the Taisho era, which ended in 1926, Japan was concerned with urgent financial, industrial and social problems which were the result of the impact of the war on an economy which for other reasons was in a stage of rapid growth and change. Shortly after the end of that era, just when the problems of adjustment seemed to be approaching solution, Japan was overwhelmed by the world depression of 1930-31, and her efforts to free herself from its effects brought about profound modifications in economic policy and in the trend of industrial development. Let us, first, survey briefly the proximate effects of the Great War on Japan. Then we can pass to a more detailed study of her financial, industrial and commercial history during the twenties.
The immediate effect of the war was to accentuate the financial difficulties with which Japan was already struggling; for it not merely interrupted some of her more important channels of trade but also disorganized her arrangements for financial settlements through London. In the early months of 1915, however, it became clear that the country was on the threshold of a period of unexampled prosperity. Markets, especially Oriental markets, were thrown open to her through the inability of the former suppliers to meet current demands; contracts for munitions began to be placed with Japanese manufacturers by Allied Governments; and there arose a strong demand for Japanese shipping. These conditions persisted until the end of the war; indeed, the industrial boom lasted until the break in the spring of 1920. Important new enterprises were established in many branches of industry; existing enterprises were enlarged; and between 1914 and 1919 the number of workers in factories that employed 5 persons and over grew from 948,000 to 1,612,000.1 Some details of this industrial expansion will be given in the____________________