Vol. 78, No. 3

Kiyotaka MAEDA
Japanese salt manufacturers’ business expansion into Taiwan and the Kwantung Leased Territory in the prewar period

This paper aims to elucidate the process by which salt manufacturers in the Japanese sphere of influence began to fill the role of raw material suppliers to the home islands of Japan.

Until World War I, salt manufacturers in the Japanese colonies were not formally established as raw material suppliers; in fact, the Japanese salt manufacturers’ business expansion and deployment in these colonies occurred in a later period, responding to structural changes in the domestic salt market prompted by the introduction of the salt monopoly system in 1905. After the outbreak of WWI, demand for salt rapidly increased in Japan, leading to a change in the monopoly policy. Consequently, the salt industry in the Japanese colonies gradually filled the role of raw material suppliers to Japan’s domestic regions. At the same time, domestic Japanese buyers of salt began to expand their business into the Japanese colonies for self-procurement. Therefore, this paper suggests that Japanese salt manufacturers’ motivations for business expansion into the colonial regions changed during the WWI period in parallel with the growing importance of raw materials to the nation.

Yune-Jung JANG
The procurement of overseas resources in prewar Japan and Dutch East Indies oil: oil negotiations between Japan and the Dutch East Indies in 1940

After the outbreak of the Sino-Japanese War in 1937, the relationship between America and Japan deteriorated, and securing oil from the Dutch East Indies (DEI), which was the second major oil supplier for Japan, had crucial importance for　Japan. In 1940 American action to limit the export of oil to Japan brought about oil negotiations between Japan and the DEI. This article explores the negotiations from the DEI’s standpoint to elucidate its oil export policy toward Japan. Images offered in earlier studies indicate that American interference in the negotiations lead the DEI to take a negative stance with regard to oil exports to Japan. This is based on the supposition that the ‘ABCD’ powers- America, Britain, China, and the Dutch- were engaged in a conspiracy to deny resources and strangle Japan. In this article, however, it is argued that the DEI was willing to meet the Japanese request to the extent possible. The DEI government had no objection to increasing oil exports to Japan before the negotiation. And in the negotiations, although the DEI delegation refused the request for export of aviation fuel, total Japanese procurement of petroleum and products was three or four times larger than each category of export in the previous three years.

Motoyuki GOTO
Development of private psychiatric hospitals and public confinement in prewar Japan: the system of bed supply under the Mental Patients’ Custody Act and the Mental Hospitals Act

This study seeks to clarify the historical process by which Japanese psychiatry came to be over-dependent on private hospitals, through an analysis of the practice of public commitment of modern Japanese psychiatric policy in the prewar period.

This reconsideration of the pattern of development of mental hospitals will show how the supply of psychiatric care structurally developed throughout the pre and post war periods, an aspect neglected by previous studies.
This article demonstrates some important facts of Japanese psychiatry; first, that police and heads of local governments played a leading role in public confinement under the Mental Patients’ Custody Act. Second, psychiatric beds were mostly supplied by private hospitals, while the government covered the costs. As a result, private beds came to have a public nature, indicated by their relation to public safety and relief to the poor.

By understanding these facts it will be possible to explain the reasons why, in terms of the system of bed supply, Japanese psychiatry relies so heavily on the private sector, and why long-term hospitalization or ‘great confinement’ has been utilized.

Takenobu YUKI
Capital market and corporate governance: growth strategy in early-twentieth-century Japan’s cotton-spinning companies

This paper examines the influence that the capital market, where stockholders’ evaluation is indicated by the stock price, exerted upon corporate governance in the cotton-spinning companies between 1903 and 1918.
A panel data analysis shows that companies can be divided into two groups—those whose dividend ROE was relatively high and those whose dividend ROE was relatively low. In other words, the former companies intended to achieve secular, long-term growth, and the latter tended to seek short-term profits.

The analysis showed that stockholder-investors’ modes of profit seeking in the capital market differed with the type of company. The stockholder-investors attached high value to long-term-growth companies’ assets, but not to those of short-term-profit companies. In fact, they were only concerned with short-term-profit companies’ current income.

Furthermore, the paper considered the salaried managers’ incentive control　problem, showing that managerial remuneration in both types of companies was closely related to ROE. That is, salaried managers had to manage the company and meet stockholders’ expectations. Therefore, managers maximize their own income by maximizing stockholders’ income through managerial practices that help them meet stockholders’ expectations.

Atsushi KOBAYASHI
The growth of intra-Southeast Asian trade in the first half of the nineteenth century: the role of middlemen in Singapore

This paper argues that the expansion of Southeast Asian trade in the first half of the nineteenth century was partly driven by the growth of intra-Southeast Asian trade.

According to the estimates made in this paper, based on British and Dutch colonial trade statistics, the volume of intra-Southeast Asian trade centered on the British and Dutch colonies grew from 1828 to 1852, with the focus shifting from Java to Singapore. The Dutch protectionist tariffs, initially imposed on imports of British cotton goods from Singapore, were gradually reduced in response to British diplomatic protests during the 1830s and the early 1840s; the British protests reflected the interests of the Straits Settlements’ merchants. The growth of trade was also facilitated by the emergence of Chinese middlemen in Singapore. The Chinese middlemen who purchased cotton goods from European merchants on credit formed long-term relationships with Chinese traders through recurrent transactions, while engaged, at the same time, in spot market transactions with local Malay and Bugis traders. The multilateral trade relationships that thus emerged facilitated the distribution of European cotton goods throughout the region, leading to the growth of the intra-regional trade of Singapore.

Hitomi HOHRI
The dynamism of cotton weaving clusters in interwar Banshu: an approach from the factory

In this paper I examine the dynamism of the factory as background to the development of cotton weaving clusters (sanchi [industrial cluster]), through a long-term examination of individual factories and the composition of the clusters. In the intensely competitive environment of Banshu, the weeding out of poor performers propelled the development of the district, with particularly important changes around 1927 and 1932. Around the first date, which was when export-oriented production became dominant, high risks accompanied the transition from domestic to export production, and only those firms which survived this stage continued to exist. Frequent and unpredictable changes in overseas markets led to drastic fluctuations in profits. Many new factories were set up around 1932; some of these new factories were set up by entrepreneurs from other sectors who were responding to the low exchange rate and low start-up costs, while others were branches of existing factories. By setting up branch factories during periods of good market conditions, companies attempted to spread the risk by producing goods different from the main factory, and in doing so hoped to stabilize their operations.