This paper aims to analyze the machine industry in the latter part of the Meiji era. The Internal-combustion engine was the typical product of medium and smaller ironworks. In about 1894, gas-engines and oil-engines were actually begun to be used among the people in Japan. Soon afterward the production of gas and oil engines started, and the products were the imitation of imports. The manufacturers were not engineers but skilled craftsmen. After the Russo-Japanese War, decrease in military demands and depression of the ship-building industry caused unemployment of many craftsmen in the big businesses. Many of them found work in medium and smaller ironworks. These new small ironworks factories increased in number. They had lost their former customers, such as the military and shipyards, and thus they had to get new civilian demands. The small internal-combustion engine was a suitable product for them. Their production and sales was very active. These engines were fairly cheap compared to imports, because of the low wages for the craftsmen. Because of this the motorization of rice cleaning, weaving, and fishing boats was hastened. During this period, the internal-combustion engine kept the leading role of mechanization in the country, because the supplied area of electricity was still narrow. Afer 1907, most of the small internal-combustion engines were homeade but the larger ones (mostly suction-gas engines) were still imported. Furthermore the bigger ironworks began to produce new types of engines and large ones under the lead of engineers. Some of them even started interchangeable manufacture under the lead of American engineers. However, this system aimed for high quality and thus the price of manufacture was high. But, it was the many smaller makers, whose products had low-price, who continued to keep the greater part of the internal-combustion engine industry.
