FEATURE ARTICLES
Introduction: The Diversity of “Emerging Markets”
New Perspectives from Japan and the Asian-Pacific Region in the Pre-World War II Period
2023 年 40 巻 p. 1-5
詳細
2023 年 40 巻 p. 1-5
Although the need for global history is well acknowledged internationally, it has rarely been implemented properly. Pomeranz's Great Divergence theory on China has stimulated the publication of thousands of historical and economic researches worldwide for the past two decades. However, while having been placed on a pedestal, this monumental inquiry has been turned into a “West versus the Rest” dichotomy, which can no longer be expected to produce proper global approaches.1 It is especially striking that Japan has not attracted much attention and has gained little benefit from the “heat” of the controversy. Equally notable is the fact that business history studies have mostly sidestepped the question of divergence. As Geoffrey Jones has recently pointed out, “business historians have a real opportunity to engage in the Great Divergence debate by investigating managerial practices and systems in the early modern period.”2 We agree with this view. However, as Jones has also stated clearly, “by the interwar years, there is evidence of a more general emergence of modern business enterprise in Asia, Latin America, and Africa.” Keeping both of these views in mind, we have collected in this special issue researches on Japanese business activities in the Asian-Pacific region during the period in question.
Our ambition here is to stimulate new global approaches in business history and launch a global reflection that combines both the Emergence and Divergence paradigms. These paradigms rely on the “West versus Rest” dichotomy, which prevents us from embracing the diversity of human activities at a global level. Here, Japan’s experience provides us with some key perspectives. For instance, scholarly literature to date has generally considered Japan to be a developed economy similar to those in the West. In actual fact, the country might more accurately be considered an emerging economy concerning the period from the end of the nineteenth to the first half of the twentieth. The case of Japan confronts us with the question of where to draw the line between what is “emerging” and what has already “emerged.” From where exactly does a market or economy “emerge”? “Foreign domination” is one potential answer that sounds convincing.3 However, can Britain be said to have “emerged” from “foreign domination” in the eighteenth century? The studies presented in this special issue indicate that “emergence” first relies on international competition for new products, technologies, institutions, and practices in management and investment. This “competition” fosters emulation and eventually has political consequences, possibly in the shape of foreign domination. In other words, foreign domination can be understood as a consequence of the economic “emergence” process, not its matrix. To borrow Braudel's words, in the ocean of history, political waves must not be mistaken for economic tides: emergence is eventually more or less shaped politicly, but these political “clothes” are local and change quickly, whereas economic structures and dynamics must be grasped at a deeper, more global level.
A similar issue lies in the divergence paradigm. Jones has suggested that “the existing Great Divergence literature, primarily written by economists, has yet to provide firm evidence of how exactly it shaped entrepreneurship and business.” 4 In our view, we must turn this perspective around and link it back to our application of Braudel's view: Business historians must provide firm evidence of how exactly entrepreneurship and business shaped the “Great Diversity” in the development and emergence processes. We propose a shift from the divergence paradigm to the diversity paradigm in order to comprehend the nature of capitalism and the modern economy in global dimensions. By adopting such a perspective, the diverse nature of the global economic development can be revealed. In addition, we believe that this global approach will shed new light on old, deep-rooted national debates such as the famous Japanese “Capitalism Controversy.” For decades, it has seemed as if the “particularity” of Japanese capitalism were an endless, dead-end interrogation. However, by adopting the concept of diversity in the forms of capitalism at the global level, the idea finds its full meaning: There is no anomaly in Japanese capitalism being “special” or “particular”; What is anomalous, however, is to regard the difference as an anomaly.
In our field of research, business history, we tackle these issues by examining business practices adopted inside Japan as well as those adopted by Japanese companies operating in emerging markets abroad. Currently, historical explorations of trade and trade-related services constitute the liveliest field of research on global capitalism. For the last two centuries, multinational trading companies have carried out core functions in international investment, commerce, and the transfer of knowledge and skills across international borders. They are also drawing attention as a driving force behind the formation of global capitalism.5 Mainly through their search for “emerging markets,” trading companies have played a unique role in extending capitalism at a global level. Given their growing importance in the world economy, it is no wonder that investigations into their structure and business responses have become key tasks for both business administration and business history studies.6 In Japan, business history research on trading companies has accumulated an abundance of findings. Especially in recent years, the active use of materials confiscated from Japanese enterprises in December 1941, which have been held at the U.S. National Archives (NARA) and the National Archives of Australia (NAA), has gradually brought to light concrete realities surrounding corporate activities implemented by general trading companies such as Mitsui & Co. and Okura & Co. in the U.S. and also in the Asian-Pacific region.7
Following these research trends, we seek to clarify roles played by multinational trading companies in the development phases of emerging markets through case studies regarding the Asian-Pacific region. Japanese general trading companies played instrumental roles in the development of new markets and products, embodying the “intertwined relations”8 that shaped global history. During the interwar period, their roles were clear. Furthermore, the period under investigation, that is, from the late nineteenth century to the early 1930s, was the era of the first global economy, during which multinational trading companies were on their way to full-fledged development. Goods investigated in this special issue include transport machinery such as locomotives (Nakamura), automobiles (Okabe and Bytheway), aircrafts (Roy and Oshima), and petroleum as a fuel for them (Yagashiro). These goods were major articles newly manufactured during the interwar period and were linked to radical technical innovations. The exploration into these fields will shed new light on interwar Japan, highlighting it not only as a sought-after emerging market for both foreign and Japanese companies, but also as a developed economy trying to seize new emerging markets abroad for its own benefit. The significance of our attempts to investigate the trade of new goods such as automobiles resides in furthering research on “emerging markets” from the dual aspects of goods and regions. That is to say, an emerging market attracts emerging actors, especially from abroad, intensifies competition, stimulates business innovation, and eventually generates political tensions. The articles included in this special issue demonstrate how trading companies nurtured emerging markets and connected manufacturers to the markets.
Naofumi Nakamura's article, “The First Global Economy and the U.S.-Japan Locomotive Trade,” investigates the locomotive supply system that supported the rapid development of Japan's railway industry at the turn of the twentieth century, focusing on technological independence of Japanese mechanical engineers and the export of American-made locomotives to Japan. This article demonstrates how Baldwin Locomotive Works, an American locomotive manufacturer, dismantled the British monopoly and penetrated the Japanese market, with special attention drawn to roles played by multinational trading companies such as Frazar & Co., which mediated the supply of locomotives and rolling stock. They introduced locomotive manufacturers to railway company engineers, government officers, and academics in Japan, China, and elsewhere. In the emerging markets, research and transaction costs were heavy burdens on both manufacturers and customers. Multinational trading companies helped lower these costs and increase overall profits by the use of their knowledge of the markets.
Keishi Okabe and Simon James Bytheway's article, “Exploring Emerging Markets,” investigates roles played by Mitsubishi Trading Company (Mitsubishi Shōji Kaisha – MSK) in its pioneering effort to export Datsun passenger cars to Australia during the 1930s. How were Japanese manufacturers able to enter key overseas markets dominated by established American, British, and European brands? Moreover, how did these interwar experiences relate to Japan becoming a major exporter of machinery to the Americas, Western Europe, and eventually to the emerging markets of the Asian-Pacific region in the latter half of the twentieth century? MSK was quick to find local partners and attempt to distribute Japanese automobiles to the Australian market through a bold joint venture with the newly formed Eastern Distributors Limited of Melbourne. However, the local assembly of Datsun vehicles from Japanese-made knock-down kits (and the subsequent retail project) soon failed. The whole episode nonetheless provided Japanese manufacturers with valuable insights on the future prospect of automobile export. In conclusion, the article notes that Nissan Motor Company and Mitsubishi did make a comeback after the War, and that as a result of their continued efforts they now enjoy a high standing among Japanese automakers in Australia in terms of both market share and sales performance.
Hisayuki Ōshima and Alexandre Roy's article, “France and Mitsubishi in the Emergence of the Aeronautical Market in Japan,” explores attempts by Japanese business actors to emerge in this new high-tech sector and also those by the mature French aviation industry to dominate the nascent Japanese market. Focusing on MSK, the authors show how this general trading company provided useful information and contracts to Mitsubishi Internal Motors Company while introducing them to French and German partners. By contrast, French companies did not have such structures and relied on government officials for their business development in Japan. This ultimately frustrated their attempts in the Japanese market when the French government banned further cooperation with Mitsubishi for fear of a leak of cutting-edge technologies to Germany through the company. Oshima and Roy show that general trading companies were particularly effective in emerging markets and played a key role in the transfer of technologies and innovations.
Hideyoshi Yagashiro's article, “The Worldwide Expansion of Japanese Trading Companies and U.S. Enterprise in the Interwar Period,” examines functions assumed by trading companies on behalf of American oil firms at the time when the latter were developing their business in the high-risk emerging market of Japan as part of their global expansion activities. In particular, the author focuses on trading services MSK provided for the Associated Oil Company. He concludes that one of the reasons for Mitsubishi's “success” was that it absorbed the costs and risks that should have been borne by the Associated Oil under their original contract, while at the same time exerting, with its superior local knowledge, the discretionary power to execute transactions.
We hope our questions and findings will help advance reflection and research in the direction of questioning the “emergence” paradigm while drawing new global perspectives from Japan’s experiences in regards to “diversity” in Business History.
1 Stefano Agnoletto, “Endogenous and Exogenous: Debating the Historiography of the Industrial Revolution and the Great Divergence,” Essays in Economic and Business History 41, no. 1 (2023).
2 Geoffrey Jones, “Business History, the Great Divergence and the Great Convergence,” Harvard Business School General Management Unit Working Paper, 18-004 (2017).
3 Gareth Austin, Carlos Davila, and Geoffrey Jones, “Emerging Markets and the Future of Business History,” Harvard Business School General Management Unit Working Paper, 18-012 (2017).
4 Jones, “Business History, the Great Divergence and the Great Convergence.”
5 Geoffrey Jones, Merchants to Multinationals: British Trading Companies in the Nineteenth and Twentieth Centuries (Oxford: Oxford University Press, 2000), and Multinationals and Global Capitalism: From the Nineteenth to the Twenty-first Century (Oxford: Oxford University Press, 2005).
6 Alain Verbeke, International Business Strategy: Rethinking the Foundations of Global Corporate Success, 2nd Edition (Cambridge: Cambridge University Press, 2013), Mike Wright, Igor Filatotchev, Robert E. Hoskisson, and Mike W. Peng, “Strategy Research in Emerging Economies: Challenging the Conventional Wisdom,” Journal of Management Studies 41, no. 1 (2005), and Austin, Davila and Jones, “Emerging Markets and the Future of Business History.”
7 Simon James Bytheway and Hisayuki Ōshima, “1930 nen ni okeru Nihon kōgyō seihin no Ōsutoraria shijō kaitakushi－Ōkura shōji ni yoru Tōkaidenkyoku seihin yushutsu no jirei” [Exploring the Australian market for Japanese industrial product sales in the 1930s: A case study of Okura & Company’s role in supplying Japanese electrodes to Australian industry], Journal of Business, Nihon University 91, no. 2 (2021), Hiromi Mizuno and Ines Prodöhl, “Mitsui Bussan and the Manchurian Soybean Trade: Geopolitics and Economic Strategies in China's Northeast, ca. 1870s-1920s,” Business History, Online (2019), and Ueyama Kazuo and Kikkawa Yō, eds., Senzen-ki hokubei no Nihon shōsha [Japanese trading companies in North America during the pre-war period] (Tokyo: Nihon Keizai Hyouronsha, 2013).
8 Alessandro Stanziani's concept of "entrelacements du monde." See, Alessandro Stanziani, Les entrelacements du monde. Histoire globale, pensée globale (XVIe-XXIe siècles) (Paris: CNRS Éditions, 2018).
