Private-Led Technical Change in Prewar
The purpose of our research is twofold: to build a model in which agricultural producers themselves carry out innovative activities, and to apply the model to prewar Japanese agriculture in order to test its empirical validity. We believe that the construction of such a model, and its empirical verification, are essential to acquiring a deeper understanding of prewar Japanese agricultural development.
One of the reasons we study prewar Japanese agriculture is that such study is an important prerequisite to understanding the Japanese economy today. More important, it helps us in our study of many contemporary less-developed countries (LDCs), where the agricultural sector still constitutes, as it did in prewar Japan, a sizeable proportion of the economy. This view follows the tradition of regarding Japan as a model of economic development ( Kelley and Williamson, 1974; Lockwood, 1954), on the one hand, and of seeing agriculture as a strategic sector ( Ishikawa, 1967), on the other. Prewar Japanese agriculture showed remarkably rapid productivity growth from an international perspective ( Hayami and Ruttan, 1971), considering Japan's poor natural resource endowment. We believe that contemporary LDCs can learn from this Japanese experience. In this chapter, however, we wish to focus on acquiring a deeper understanding of the facts of the Japanese case, and on presenting a model relevant to those facts. The available data ( Ohkawa, Shinohara, and Meissner, 1979) show that about half of the total output growth in Japanese agriculture may be attributed to total factor productivity (TFP) growth and that this growth, and hence total production itself, decelerated suddenly around 1920 ( Hayami, 1975). We realized the importance of the development of new techniques by private farmers--a point that is also relevant to the thesis of this chapter--while studying changes in actual techniques. For example, in considering rice strains, a particularly important item in Japanese agriculture, we have found that all the major varieties of the 1920s were selected after the Meiji Restoration and before 1920 by individual private farmers ( Nogyo Hattatsu-shi Chosa Kai, 1953-58).
The role played by private farmers in the innovation process was not confined to improvement of the "best technology." In fact each farmer used his resources, especially labor, to improve "average practice." This process is usually recognized as