Sail on, black ships

The U.S. election silly season is upon us, and tradition demands that candidates bloviate about trade imbalances with protectionist Asian economies.

Japan is an old favorite—although in recent years replaced by China—and it’s back in the limelight again with the TPP trade pact.

With that in mind, we revisit common perceptions about Japan’s trading history.

Anyone with a casual understanding of Asian history knows it was the arrival of U.S. Commodore Matthew Perry’s black ships in Edo harbor in 1853 that forced the opening of a previously isolated country to foreign trade five years later. That fight to open the Japanese market continues to this day.

Right?

Well, sort of …

The belief in Japan’s total isolation from foreign trade is so ingrained in the U.S. that, as recently as a decade ago, two professors of international economics from Clark University published a paper using Japan’s transition from “autarky” to free trade to test the theory of comparative advantage.

But while autarky suggests complete self-sufficiency, Japan never actually ceased trading with the outside world after the Tokugawa Shogunate instituted the sakoku (locked country) policy in the 1630s.

Throughout the period, trade flourished with five entities – the Ainu (in Hokkaido), China, the Dutch East India Company, the Korean empire and the Ryukyu kingdom (modern-day Okinawa) – through four gateways.

Japan relied on imports of key commodities – cotton, raw silk, tea, ginseng and sugar – mostly in exchange for silver (Japan is estimated to have accounted for one-third of global silver production in the first half of the seventeenth century). Import substitution began only in the late eighteenth century, when its silver supplies had depleted.

These days, Japanese historians increasingly refer to the Tokugawa international relations policy as kaikin (maritime prohibitions) – similar to the Chinese hai jin policy implemented around the same time, in the early Qing empire – rather than as sakoku. 

Although there is ample evidence the Tokugawa Shogunate was concerned about the social impact of Christian missionaries and the risk of European colonialism when it expelled the Portuguese and Spanish, its ongoing commerce with the Dutch East India Company belies the assumption that its policy was explicitly anti-Western. 

In fact, many Japan scholars point out that controlling external trade had a strong internal rationale – it was critical to the Shogunate’s ability to exert economic and political authority over a highly decentralized and often fractious arrangement of daimyo (feudal lords).

Perhaps it once suited the Western narrative of Japan’s rising post-war power to paint the country as inherently inimical to external economic interests. It is a shame that such a narrative persists today, despite significant and compelling evidence to the contrary. 

Sources:

Daniel M. Bernhofen and John C. Brown in “A Direct Test of the Theory of Comparative Advantage: The Case Of Japan,”  Journal of Political Economy, 2004.

Toshiaki Tamaki, “Japanese Economic Growth during the Edo Period,” Kyoto Sangyo University Economic Review, 2014.