Notes and References

INTRODUCTION

I. Tekko Tokei Iinkai (ed.), Shiryo: Nihon no tekko tokei hyakunen (One hundred years of statistics on the Japanese iron and steel industry) (Tokyo: Nihon Tekko Renmei, 1970) p. 159. 2. Donald F. Barnett and Louis Schorsch, Steel: Upheaval in a Basic Indus• try (Cambridge: Ballinger, 1983). 3. Ibid., pp. 143-5. 4. Hans Mueller and Kiyoshi Kawahito, Steel Industry Economics: A Com• parative Analysis of Structure, Conduct and Performance (New York: Steel Information Center, 1978). 5. Barnett and Schorsch, Steel, p. 59. 6. As to arguments on Japan's economic development and the role of the government, see Marie Anchordoguy's Computers Inc. (Cambridge: Harvard University Press, 1989) pp. 1-17. Recently, more industry-specific studies such as David Friedman's The Misunderstood Miracle (Ithaca: Cornell University Press, 1988) and Anchordoguy's Computers Inc. have begun to contribute to multi-cause explanations for Japan's economic develop• ment and a more concrete analysis of government-business relations. These works, however, still ignored the dynamism of the private firms, and are too hasty to draw a conclusion. Japanese industrial policies differ from industry to industry, and there are tremendous learning effects between them. Before generalising about the characteristics of Japanese industrial policy and economic development, we need more cumulative and con• crete case-studies. 7. James van B. Dresser, Jr., Thomas M. Hout, and William V. Rapp, 'Com• petitive Development of the Japanese Steel Industry', in James B. Cohen (ed.), Pacific Partnership: United States-Japan Trade (Lexington: Lexington Books, 1972) p. 201. 8. Thomas McCraw and Patricia O'Brien, 'Production and Distribution', in Thomas McCraw (ed.), America versus Japan (Boston: Harvard Busi• ness School Press, 1986) pp. 93-4. 9. See Thomas R. Howell et al., Steel and the State: Government Interven• tion and Steel's Structural Crisis (Boulder: Westview, 1988) pp. 126-40. 10. For world protectionism, see Kent Jones, Politics vs. Economics in World Steel Trade (London: Allen & Unwin, 1986); and Thomas R. Howell et a/., ibid. II. See Alfred D. Chandler, Jr., Scale and Scope (Cambridge: Harvard Uni• versity Press, 1990). 12. Nathan Rosenberg, Inside the Black Box: Technology and Economics (Cam• bridge: Cambridge University Press, 1982) p. 249. 13. The World Bank, The World Bank in Asia: Summary of Activities (Wash• ington: The World Bank, 1960) p. 30.

284 Notes and References 285

14. Leonard Lynn, How Japan Innovates: A Comparison with the U.S. in the Case of Oxygen Steelmaking (Boulder: Westview Press, 1982). 15. Kiyoshi Kawahito, The Japanese Steel Industry: With an Analysis of the U.S. Steel Import Problem (New York: Praeger Publishers, 1972) p. 3. 16. Chalmers Johnson, MIT/ and the Japanese Miracle: The Growth of In• dustrial Policy, 1925-1975 (Stanford: Stanford University Press, 1982) pp. 308-310. 17. Nakamura Takafusa, Nihon no tosei keizai (The controlled economy in Japan) (Tokyo: Nikkei Shinsho, 1974) pp. 163-4.

2 OSHIMA TAKATO AND THE BEGINNING OF MODERN IRONMAKING

I. Since the Tatara method used sand iron ore as the raw material and broke down once every blowing, it could not produce enough iron. The Tatara method has its origin in the second and third centuries. 2. lida Ken'ichi, Ohashi Shuji, and Kuroiwa Toshiro (eds), Gendai nihon sangyo hattatsushi, vol. IV, Tekko (A history of modern Japanese indus• tries: iron and steel) (Tokyo: Kojunsha, 1969) pp. 13-17. 3. The book was U. Huguenin, Het Gietwezen in s'Rijks ljzer Geschutgieterij 'te Luik (Iron casting at the state-owned cannon works in Luik), and was translated by Oshima Takato and his colleague, Tezuka Ritsuzo. Although it was written in Dutch, the contents were based upon German technology. During the Tokugawa period, the Tokugawa government prohibited all foreign language books except those in Dutch. 4. J. Fairbank, E. Reischauer and A. Craig, East Asia: The Modern Transfor• mation (Boston: Houghton Mifflin, 1965) p. 182. 5. Hanzawa Shuzo, Nihon seitetsu kotohajime (The beginning of Japanese steelmaking) (Tokyo: Shin Jimbutsu Oraisha, 1974) pp. 42-60; Oshima Shinzo, Oshima Takato Kojitsu (Hyogo: Oshima Shinzo, 1938). 6. For a history of Samuel Slater, see A. D. Chandler, Jr. and R. S. Tedlow, The Coming of Managerial Capitalism: A Casebook on the History of American Economic Institutions (Homewood: Richard Irwin, 1985) p. 142. 7. Oshima Shinzo, Oshima Takato Kojitsu (Hyogo: Oshima Shinzo, 1938) p. 3. 8. Saigusa Hiroto and Iida Ken'ichi (eds), Nihon kindai seitetsu gijutsu hattatsu shi: Yawata seitetsu no kakuritsu (A history of the development of modern Japanese iron and steel technology: The establishment process of the Yawata Works) (Tokyo: Toyo Keizai Shinposha, 1957) pp. 13-26. In 1859, Nanbu-domain sent 54 tons of iron to Edo for the renovation of Edo castle. 9. Shin Nihon Seitetsu Kabushiki-kaisha Kamaishi Seitetsusho (ed.), Tetsu to tomoni hyakunen (A 100-year history of the Kamaishi Works) (Kamaishi: Shin Nihon Seitestu Kabushiki-kaisha, 1986) p. 20. Nanbu domain man• aged some of those blast furnaces for a few years, but it handed over their management to private merchants. 10. MITI (ed.), Shoko seisakushi, 17 Tekkogyo (A history of commercial 286 Notes and References

and industrial policy, vol. 17, Iron and steel industry) (Tokyo: Shoko Seisakushi Kankokai, 1970) pp. 4-5. 11. Ibid., pp. 7-8. 12. Oshima's proposal, though costly, was obviously more reasonable than that of the German engineer, Bianchi. Still, the government adopted the German proposal. To transfer Western technology quickly, it needed a great deal of help from foreign engineers, so the government usually compromised with foreign engineers. It was thus often biased in favour of foreign engineers (Hanzawa, Nihon seitetsu kotohajime, pp. 246-50). 13. According to Kuwahara Sei, two blast furnaces at Kamaishi were designed by a British Bachelor of Science named Mr 'Horubusu' (Kuwahara Sei, 'Kamaishi kozan keikyo hokoku' ['A report on the situation of Kamaishi'], Kogaku Shoshi, August, 1882), but there is no further explanation as to who 'Horubusu' was. (Quoted in Saigusa and lida, Nihon kindai seitetsu, pp. 37-8). Perhaps, 'Horubusu' is 'Forbes'. 14. Saigusa and Iida (eds), Nihon kindai seitetsu, pp. 16-18. 15. MITI (ed.), Shoko seisakushi, pp. 17-18. 16. Saigusa and Iida (eds), Nihon kindai seitetsu, pp. 65-6. 17. The whole report is cited in Saigusa and lida, Nihon kindai seitetsu, pp. 62-5. 18. The programme included the 're-introduction of convertible currency, severe public austerity, and deflation'. K. Okawa, and H. Rosovsky, 'A Cen• tury of Japanese Economic Growth', in W. Lockwood (ed.), The State and Economic Enterprise in Japan (Princeton: Princeton University Press, 1965) pp. 60-66. 19. MITI (ed.), Shako seisakushi, p. 19. 20. Ibid., pp. 35-6. 21. J. Hirschmeire and T. Yui, The Development of Japanese Business, 2nd edn (London: George Allen & Unwin, 1981) p. 86. 22. MITI (ed.), Shako seisakushi, p. 36. 23. A detailed study of the disposal of the government enterprises can be found in Kobayashi Masaaki, Nihon no kogyoka to kangyo haraisage (Industrialization and the disposal of government enterprises in Japan), (Tokyo: Press, 1977). 24. The myth became stronger when and Mitsubishi gave up their iron and steel facilities for the establishment of Japan Steel in 1934, as we shall see in Chapter 5. Even after World War II, there were many businessmen who thought the steel business too risky a venture for the private sector. 25. MITI (ed.), Shoko seisakushi, pp. 20-31. The Nakaosaka Works was a very small factory, but unlike Kamaishi, it worked as an integrated mill from the beginning. 26. Minami Ryoshin, Nihon no keizai hatten (The economic growth of Japan) (Tokyo: Toyokeizai Shinposha, 1981) p. 81. 27. When Japan abolished its isolation policy and opened its ports to the Western world, the Tokugawa bakufu did not have tariff autonomy. Until 1899, when partial autonomy was recovered, the existing tariff on steel imports could not protect domestic producers. Tominaga Yuji, Honpo Notes and References 287

tekkogyo to kanzei (The Japanese steel industry and tariffs), (Osaka: Osaka Shoka Daigaku Keizai Kenkyusho, 1932) pp. 179-84. 28. In order to establish a large, modern, and integrated facility, famous merchants and businessmen tried to incorporate Nihon Seitetsu Kabushiki• kaisha (Japan Steel Inc.) in 1888. Their motive was still speculative profits rather than steel production. In 1891, therefore, the company was liqui• dated as a consequence of the economic depression of 1890. See MITI (ed.), Shoko seisakushi, pp. 52-3.

3 ESTABLISHMENT OF THE STATE-OWNED YAWAT A WORKS

l. Fairbank, Reischauer and Craig, East Asia, pp. 185-6. 2. MITI (ed.), Shoko seisakushi, pp. 70-71. 3. Ibid., pp. 72-3. 4. Ibid., pp. 74-7; and Saigusa and lida (eds), Nihon kindai seitetsu, pp. 135-43. 5. Saigusa and lida (eds), Nihon kindai seitetsu, p. 147. Under the Con• stitution, as the Emperor had the final say on matters of national defence, the cabinet could appeal to the Emperor to carry out its national policy against the Opposition Party. 6. Goto also had had strong ties with private businessmen who had pre• viously tried to establish a steel business, men such as Amamiya Keijiro, Inoue Kakugoro, etc. MITI (ed.), Shoko seisakushi, pp. 79-82. 7. Fairbank, Reischauer and Craig, East Asia, pp. 185-6. 8. Saigusa and lida (eds), Nihon kindai seitetsu, pp. 172-3. Puddlers and crucible furnaces for specialties were installed only to meet munitions demands. 9. Noro's biography is based on Nippon tekko kyokai (ISIJ) (ed.), Soritsu nanaju shunen kinen Nihon tekko kyokai shi (A seventy-year anniversary of the Iron and Steel institute of Japan) (Tokyo: ISIJ, 1985) pp. 169-77; and lida Ken'ichi, Nihonjin to tetsu (The Japanese and steel) (Tokyo: Yuhikaku, 1982) p. 201. 10. Saigusa and lida (eds), Nihon kindai seitetsu, pp. 225-6. 11. MITI (ed.), Shoko seisakushi, pp. 93-6. 12. Real munitions demand was roughly 10 to 15 per cent, and shipbuilding demand, including warships, was about 10 per cent. MITI (ed.), Shoko seisakushi, p. 101. 13. Shin Nihon Seitetsu Kabushiki-kaisha Kamaishi Seitetsusho (ed.), Tetsu to tomoni hyakunen (A 100-year history of the Kamaishi Works) (Kamaishi: Shin Nihon Seitestu Kabushiki-kaisha, 1986) p. 86. 14. Saigusa and lida (eds), Nihon kindai seitetsu, pp. 353-60. 15. Ibid., pp. 442-52. 16. Ibid., pp. 448-9. Watanabe Wataru had studied the metallurgy at Freiberg University. 17. Noro Kageyoshi, 'Honpo seitetsu jigyo no kako oyobi shorai (The past and future of the Japanese iron and steel industry)', Tetsu to Hagane, 1:10 (1915). 288 Notes and References

18. Torii Yasuhiko, Hattentojokoku ni okeru ikkan seitetsu puranto no toshikoka bunseki- Mara-Yawata Sutchiru sha no jirei (An analysis of the linkage effect of an integrated iron and steel plant in a developing country - the case of Malayawata Steel Berhad) (Tokyo: Zaidan Hojin Kokusai Kyoryoku Suishin Kyokai, 1978) p. 2. 19. Yawata Seitetsusho Shoshi Hensan Jikko Iinkai (ed.), Yawata seitatsusho hachiju-nenshi: Sogoshi (An 80-year history of the Yawata Works: general history) (Kyushu: Shin Nihon Seitetsu Kabushiki-kaisha Yawata Seitetsusho, 1980) pp. 20-21. 20. Saigusa and Iida (eds), Nihon kindai seitetsu, pp. 565-70. 21. Yawata Seitetsusho Shoshi Hensan Jikko Iinkai (ed.), Yawata seitatsusho hachiju-nenshi (An 80-year history) p. 23. 22. Saigusa and lida (eds), Nihon kindai seitetsu, p. 419. 23. Ibid., p. 434. 24. Ibid., pp. 479-94. 25. Ibid., p. 494. 26. Ibid., pp. 486-7. 27. Ibid., pp. 368-9. 28. lmaizumi Kaichiro, 'Seitetsusho tosho juninen kan no kushin ni !suite (About the difficulties of the Yawata Works during the first twelve years)', Tetsu to Hagane, 2: 1 (1916). 29. This process is detailed in Saigusa and Iida (eds), Nihon kindai seitetsu, pp. 547-5 I. 30. Ibid., pp. 557-62. 31. The importance of organisational structure and managerial hierarchy for the growth of modern corporations has been well analysed in Alfred D. Chandler, Jr., Strategy and Structure (Cambridge: MIT Press, 1965); The Visible Hand (Cambridge: Harvard University Press, 1977); and Scale and Scope (Cambridge: Harvard University Press, 1990). 32. Yawata Seitetsusho Shoshi Hensan Jikko Iinkai (ed.), Yawata seitatsusho hachiju-nenshi (An eighty-year history) p. 36. 33. Albert Feuerwerker, China's Early Industrialization (Cambridge: Harvard University Press, 1958) pp. 145-9; Yo Ten'itsu, 'Shin matsu chugoku ni okeru keiei katsudo no yotai-Hanyan seitetsu no jirei (Business activities in the late Ching Dynasty, a case of Han yang works)', Keizai gaku kenkyu, vol. 9 ( 1967). 34. Yawata Seitetsusho Shoshi Hensan Jikko Iinkai (ed.), Yawata Seitetsusho hachiju nen shi: Bumonshi-ge (An 80-year history: special vol. 2) p. 241. 35. MITI (ed.), Shoko seisakushi, p. 123. 36. The description of the Russo-Japanese War is based on Fairbank, Reischauer and Craig, East Asia, pp. 186-9. 37. Saigusa and Iida, Nihon kindai seitetsu, p. 263. 38. Feuerwerker, China's Early Industrialization, p. 68; and Nihon Kogyo Ginko (ed.), Nihon Kogyo Ginko gojunen shi (A 50-year history of the Industrial ) (Tokyo: Nihon Kogyo Ginko, 1957) pp. 105-112. 39. MITI (ed.), Shoko seisakushi, p. 149. 40. lida eta/. (eds), Gendai nihon sangyo hattatsu shi, IV, Tekko (History of modern Japanese industries: Iron and steel), (Tokyo: Kojunsha, 1969) p. 186. Notes and References 289

41. As Sheng also tried to construct a nationalised railway with a European loan syndicate, he was accused of betraying China. See ibid., p. 149, and Feuerwerker, China's Early Industrialization, p. 81. In 1911, how• ever, Sheng lost his position because of the revolt led by Sun Yat-sen in China. Meiji Tekkoshi Hensan Iinkai (ed.), Meiji tekkoshi (A Meiji iron and steel history) (Tokyo: Chikura-Shobo, 1945) pp. 609-616. 42. The first president of SMRC, Goto Shinpei, said, 'The secret to manag• ing Manchuria is that, disguised as a railway company, we can do many different things.' Quoted in Harada Katsumasa, Mantetsu (SMRC) (Tokyo: lwanami Shinsho, 1981) p. 40. 43. Hanawa Saburo (ed.), Showa Seikosho nijunen-shi (A 20-year history of the Showa Steel Corporation) (Anshan: Showa Seikosho, 1940). 44. MITI (ed.), Shoko seisakushi, pp. 144-5. 45. Imaizumi Kaichiro, 'Waga seitetsusho no jigyo ni tsuite (Regarding the future of the Yawata Works)', Tetsukuzu-shu (An essay on scrap) (Tokyo: Koseikai Shuppanbu, 1930).

4 ESTABLISHMENT OF THE INDUSTRY: YAWATA AS A BUSINESS INCUBATOR

1. Hazama Genzo, 'Dokusen shihonshugi no kakuritsu (The establishment of monopolistic capitalism)', in Hazama Genzo et al. (eds), Koza Nippon shihonshugi hattatsushi (Tokyo: Nihon Hyoronsha, 1968) pp. 2-3. 2. lida et al. (eds), Gendai nihon sangyo hattatsu shi, p. 176. The percent• ages of the military expense after the war were 28 per cent in 1906; 33 per cent in 1907, 1908, and 1909; and 35 per cent in 1910 and 1911. 3. Hazama, • Dokusen shihonshugi no kakuritsu ', p. 2. 4. The technological explanation of the open hearth furnace process is based on A. K. Osborne (ed.), An Encyclopedia of the Iron and Steel Industry (New York: Philosophical Library, 1956) pp. 296-7. 5. MITI (ed.), Shoko seisakushi, 17, Tekkogyo (A history of commercial and industrial policy), vol. 17, (Iron and steel industry) (Tokyo: Shoko Seisakushi Kankokai, 1970) pp. 139-41. 6. The categorisation is based on lida et al., Gendai nihon sangyo hattatsu shi, pp. 174-84. 7. The history of Sumitomo Metal Industries is based on Sumitomo Kinzoku Kogyo Rokuju-nen Shoshi Hensan Iinkai (ed.), Sumitomo Kinzoku Kogyo rokuju-nenshoshi (A 60-year history of Sumitomo Meta/Industries) (Osaka: Sumitomo Metal Industries, 1957). 8. Minami Ryoshin, The Economic Development of Japan: A Quantitative Study (New York: St Martin's Press, 1986) p. 125. 9. The history of Kobe Steel is based on Shinko Goju-nenshi Hensan Iinkai (ed.), Shinko goju-nenshi (A 50-year history of Kobe Steel) (Kobe: Shinko Goju-nenshi Hensan Iinkai, 1954). 10. The history of the Kawasaki, Hyogo Works is based on Kawasaki Seitetsu Kabushiki-kaisha Shashi Henshu linkai (ed.), Kawasaki Seitetsu nijugo• nenshi (A 25-year history of Kawasaki Steel) (Kobe: Kawasaki Seitetsu Kabushiki-kaisha, 1976). 290 Notes and References

11. The history of Nihon Seiko-sho is based on Iida et a/., Gendai nihon sangyo hattatsu shi, pp. 178-9, and Hokkaido Tanko Kisen Nanaju-nenshi Hensan Iinkai (ed.), Hokkaido Tanko Kisen nanaju-nen shi (A seventy• year history of HCSC) (Tokyo: Hokkaido Tanko Kisen Kabushiki-kaisha, 1958) pp. 97-102. 12. Iida et a/., Gendai nihon sangyo hattatsu shi, p. 179. 13. The history of the Kamaisi Works is based on Fuji Seitetsu Kabushiki• kaisha Kamaishi Seitetsusho (ed.), Kamaishi Seitetsu-sho nanaju-nenshi (A seventy-year history of the Kamaishi Works) (Tokyo: Fuji Seitetsu Kabushiki• kaisha, 1955). 14. lida eta/. (eds), Gendai nihon sangyo hattatsu shi, Appendix -statistics, p. 23. 15. Horikiri Yoshio, Nihon tekkogyo-shi kenkyu (A study of the history of the Japanese iron and steel industry) (Tokyo: Waseda University Press, 1987) pp. 45-50. 16. Nippon Tekkoshi Hensan Iinkai (ed.), Nihon tekkoshi: Meiji-hen (The Japa• nese iron and steel history: Meiji period) (Tokyo: Chikura-shobo, 1945) p. 556. 17. The history of Hokkaido's Wanishi Iron Works is based on Muroran Seitetsu-sho (ed.), Muroran Seitetsu-sho goju-nenshi (A 50-year history of the Muroran Iron and Steel Works) (Hokkaido: Fuji Seitetsu Kabushiki• kaisha, 1958), and Iida et a/. (eds), Gendai nihon sangyo hattatsu shi, p. 179. 18. Imaizumi Kaichiro, Kuzutetsu-shu (An essay on scrap) (Tokyo: Koseikai Shuppanbu, 1930). 19. The history of NKK is based on Nihon Kokan Kabushiki-kaisha Rokuju• nenshi Hensan Iinkai (ed.), Nilwn kokan kabushiki-kaisha rokuju-nenshi (A 60-year history of NKK) (Tokyo: Nippon Kokan Kabushiki-kaisha, 1972). 20. As to the Okura , see Okura Zaibatsu Kenkyu-kai (ed.), Okura zaibatsu no kenkyu (A study of the Okura zaibatsu) (Tokyo: Kondo Shuppansha, 1982). 21. The history of Han Yeh Ping is based on lida eta/. (eds), Gendai nihon sangyo hattatsu shi, pp. 185-6, and Sato Shoichiro, 'Senzen nihon ni okeru kangyo zaisei no tenkai to kozo 1-V (A financial development and structure of the state-owned works in the prewar Japan)', Keieishirin (1966-68). 22. Calculated from the Appendix of Yawata seitetsu-sho goju-nenshi (A 50- year history of the Yawata Works). 23. The history of the Anshan Works is based on Asawa Saburo (ed.), Showa seiko-sho nijyunen-shi (A 20-year history of Showa Steel) (Anshan: Showa Seiko-sho, 1940). 24. The history of Ben Xi Hua Coal and Iron Company is based on Okura Zaibatsu Kenkyukai (ed.), Okura zaibatsu no kenkyu. 25. The history of Mitsubishi Steel is based on Hatate lsao, Nihon no zaibatsu to Mitsubishi (The Japanese zaibatsu and Mitsubishi) (Tokyo: Gakuyu Shobo, 1978) pp. 177-9. 26. Iida et al. (eds), Gendai nihon sangyo hattatsu shi, pp. 183-4. 27. Yonekura Seiichiro, 'The Emergence of the Prototype of Enterprise Group Notes and References 291

Capitalism - The Case of Mitsui', Hitotsubashi Journal of Commerce & Management, 20: 1 (1985) pp. 80-88. The Japanese general trading firms, (sogo shosha) increased their competitive advantage over the specialised trading firms through accumulated knowledge and know-how. 28. lida et al. (eds), Gendai nihon sangyo hattatsu shi, pp. 172-3. 29. Nagashima Osamu, Senzen Nihon tekkogyo no kozo bunseki (A structural analysis of the Japanese steel industry in the pre-World War II period) (Kyoto: Mineruba Shobo, 1987) p. 70. 30. Ibid., pp. 221-31. 31. Ibid., p. 70.

5 IMPACT OF THE FIRST WORLD WAR: GOVERNMENT, ZAIBATSU, AND TECHNOLOGY l. Because of the serious shortage of iron and steel, the new phrase, 'steel famine,' was created by the media and was printed in newspapers and magazines almost every day during the war. (MITI (ed.), Shoko seisakushi, Tekkogyo, p. 169). 2. lida et al. (eds), Gendai nihon sangyo hattatsu shi, pp. 190-91. 3. Ibid., pp. 191-2. 4. Kaneko Eiichi (ed.), Gendai nihon sangyo hattatsushi, IX, Zosen (The history of the modern Japanese industries, vol. IX, Shipbuilding) (Tokyo: Kojunsha, 1964) pp. 152-3. 5. MITI (ed.), Shoko seisakushi, p. 169. 6. Ibid., p. 169. 7. Yawata Seitetsusho (ed.) (A 50-year history) pp. 12-14, and MITI (ed.), Shoko seisakushi, pp. 170-72. 8. MITI (ed.) p. 177. 9. These academic associations were the Iron and Steel Institute of Japan, the Electronics Academy, the Machinery Academy, the Shipbuilding Academy, and the Armoury Academy (MITI (ed.), Shoko seisakushi, pp. 177-9). 10. The report only said, 'The Yawata Works and the private firms should cooperate with each other.' Ibid., pp. 187-8. II. Ibid., p. 187. 12. Ibid., p. 191. 13. Iida et al. (eds), Gendai nihon sangyo hattatsu shi, pp. 199-200. 14. This collateral relationship has already been pointed out by Ohashi Shuji in MITI (ed.), Shoko seisakushi, p. 193. 15. Mitsubishi reduced its capital from 30 million to 5 million yen, NKK went from 21 million to 10.5 million yen. 16. lida et al. (eds), Gendai nihon sangyo hattatsu shi, p. 207. 17. Ibid., p. 205. 18. Ibid., p. 206. 19. Ibid., p. 207. 20. The price of steel bars per ton in Germany was 65.2 yen, while that in Japan was 117 yen. Therefore, German steel could be competitive, even when transportation costs and tariffs were added to the price (ibid., p. 208). 21. Tata Iron and Steel Company, Bengal Iron Company, and Indian Iron 292 Notes and References

and Steel Company had 610 000, 140 000, and 250 000 tons annual ca- pacity, respectively, while Yawata (including Toyo's capacity), Kamaishi, Wanishi, and Mitsubishi had 636 000, 134 000, 177 000, and 102 000 tons, respectively. Data are from Nagashima, Semen nihon tekkogyo no kozo bunseki, p. 160 and p. 170. 22. Iida el al. (eds), Gendai nihon sangyo hattatsu shi, pp. 208-9. 23. Yawata Seitetsusho (ed.), Yawata Seitetsu hachiju nenshi (An 80-year history of the Yawata Works) pp. 65-7. 24. Iida et al. (eds), Gendai nihon sangyo hattatsu shi, pp. 198-9 and pp. 208-9. 25. The limit of the domestic market was first pointed out by Morikawa Hidemasa in his 'Senzen nihon ni okeru senko ikkanka undo (The inte- gration movement of the Japanese iron and steel industry before the Sec- ond World War)', Keizai Shirin, 28: 3 (1960). 26. Mitsui Bunko (ed.), Mitsui jigyoshi honpen, 3-jo (Mitsui business his- tory, vol. 3—1st) (Tokyo: Mitsui Bunko, 1980) pp. 119-70. 27. Ibid., pp. 141-2. 28. Fuji Seitetsu Kabushiki-kaisha Kamaishi Seitetsusho Shashi Hensan Iinkai (ed.), Kamaishi seitetsusho nanaju-nenshi (A 70-year history of the Kamaishi Works), pp. 70-86. 29. Mitsui Bunko (ed.), Mitsui jigyoshi honpen, pp. 303-4. 30. Hatate Isao, Nihon no zaibatsu to Mitsubishi (The Japanese zaibatsu and Mitsubishi) (Tokyo: Gakuyu Shobo, 1978) pp. 177-80. 31. Sumitomo Kinzoku Kogyo Shashi Hensan Iinkai (ed.), Sumitomo kinzoku kogyo rokuju-nen shashi (A 60-year history of Sumitomo Metal Industry) pp. 22-41, and pp. 86-104. 32. See Okura Zaibatsu Kenkyu-kai (ed.), Okura zaibatsu no kenkyu. 33. Nagashima also distinguished NKK, Tokai, and Fuji from Asano's Kokura and Shipbuilding's Steel division; because of their independent manage- ment from the Asano zaibatsu. See Nagashima, Senzen nihon tekkogyo no kozo bunseki, pp. 218-222. 34. Nihon Tekko Kyokai (ISIJ) (ed.), Nihon tekko kyokai goju-nenshi (A 50- year history of ISIJ) (Tokyo: Nihon Tekko Kyokai, 1965) p. 38. 35. Ibid., p. 80. 36. Interview with Watanabe Sanyo (Councillor of ISIJ), at the office of ISIJ in Tokyo in June 1983. 37. ISIJ, Nihon tekko kyokaigoju-nenshi, pp. 57-62. 38. As the 1930s saw the indigenisation of the values and institutions that had been borrowed from the West in the Meiji era, the same indigenisation occurred in the field of technology. See Albert Craig (ed.), Japan: A Comparative View (Princeton: Princeton University Press, 1979), p. 7. 39. Iida Ken'ichi first pointed out this integration in his Nihon tekko gijutsushi -ron (A history of iron and steel technology in Japan) (Tokyo: Toyokeizai Shimposha, 1979) pp. 236-77. 40. Saigusa and Iida (eds), Nihon kindai seitetsu gijutsu hattatsushi (A history of the development of the modern iron and steel technology in Japan) pp. 647-8. 41. Ibid., p. 648. 42. Shimada Haruo, 'Senzen Yawata seitetsusho ni okeru rodojijo' (Working Notes and References 293

conditions at the Yawata Works in the prewar period), Mita Gakkai Zasshi 62: 1 ( 1969) p. 84. 43. Ibid., p. 84, and lida et al. (eds), Gendai nihon sangyo hattatsu shi, pp. 258-9. 44. Iida et a/. (eds), Gendai nihon sangyo hattatsu shi, pp. 242-55. The textbooks, such as Kuroda Taizo's, Saikin gaitan seizo-ho oyobi fuku• sanbutsu shori-ho (Coke production and its by-products}, and Nunome Shirokichi's, Tetsu oyobi ko no atsuen sagyo-ho (The rolling methods for iron and steel), were publicly published and were invaluable to the industry's engineers. 45. Calculated from the membership list of the alumni association of the Department of Metallurgy and Mining of the University of Tokyo. Tokyo daigaku kogakubu kinzokukei gakka doso meibo (A membership list of the alumni association of the Department of Metallurgy and Mining at the University of Tokyo) (Tokyo: Toyakai Jimukyoku, in the University of Tokyo, 1987). 46. Tokyo Daigaku Hyakunenshi Henshu Iinkai (ed.), Tokyo daigaku hyakunen shi bukyokushi 3 (A 100-year history of the University of Tokyo, vol. 3) (Tokyo: University Press of Tokyo, 1987) pp. 19-24. 47. Iida et a/. (eds), Gendai nihon sangyo hattatsu shi, pp. 222-3. 48. Ibid., pp. 237-9. 49. Sumitomo Shashi Hensan Iinkai (ed.), Sumitomo kinzoku kogyo rokuju• nen shoshi, p. 94. 50. The importance of these three developments had been pointed out by Iida et a/. (eds), Gendai nihon sangyo hattatsu shi, pp. 222-39. This section is largely based on their book. 51. Shin Nihon Seitetsu Sogo-chosabu, Sengo sanjugo-nen no Nippon tekkogyo hatten no rekishi (A 35-year history of the development of the Japanese iron and steel industry) (Tokyo: Shin Nihon Seitetsu, 1980) pp. 25-42. Iida et a/. (eds), Gendai nihon sangyo hattatsu shi, pp. 229-39. 52. The discussion and technological facts are based on Asawa Saburo (ed.), Showa Seiko-sho nijunen-shi (A 20-year history of Showa Steel) (Anshan: Showa Seiko-sho Kabushiki-kaisha, 1940), lida et al. (eds), Gendai nihon sangyo hattatsu shi, p. 230. 53. lida et al. (eds), Gendai nihon sangyo hattatsu shi, p. 213. 54. Technological discussion of the Kuroda coke oven is based on Iida et a/. (eds), Gendai nihon sangyo hattatsu shi, pp. 222-3. 55. Discussion of the large blast furnace is based on ibid., pp. 233-5. 56. Kawasaki Tsutomu, Sengo Nihon tekkogyo ron (The postwar Japanese iron and steel industry) (Tokyo: Tekko Shimbunsha, 1968) p. 490. 57. Toda Hiromoto, Gendai sekai tekkogyo ron (The world's iron and steel industry) (Tokyo: Bunshindo, 1984) p. 3. 58. Yawata Seitetsusho (ed.), Yawata seitetsu-sho goju-nenshi (A 50-year his• tory) p. 307. 294 Notes and References

6 ESTABLISHMENT OF JAPAN STEEL: PRIVATISATION OF YAWATA

I. Kent Jones, Politics vs Economics in World Steel Trade (London: Allen & Unwin, 1986) pp. 20-25. 2. MIT! (ed.), Shoko seisakushi: Tekkogyo, 17 (A history of commercial and industrial policy: iron and steel industry, vol. 17) (Tokyo: Shoko Seisakushi Kankokai, 1970) pp. 212-14. 3. Nihon Kogyo Kurabu (The Japan Industrial Club), 'Seitetsu jigyo hogo shorei ni kansuru kengisho (A proposal for the protection and promotion of the iron and steel industry),' quoted in ibid., pp. 205-7. 4. MIT! (ed.), Shoko seisakushi, p. 206. 5. Tominaga Yuji, Honpo tekkogyo to kanzei (The Japanese iron and steel industry and tariffs) (Osaka: Osaka Shoka Daigaku Keizai Kenkyusho, 1932) pp. 220-21. 6. Hakuni Takeshi, 'Honpo seitetsugyo ni kansuru iken', quoted in Nihon Tekkoshi Hensan Iinkai (ed.), Nihon tekkoshi (A history of iron and steel in Japan), vol. 3, no. 6 (Tokyo: Nippon Tekkoshi Hensan Iinkai, 1950- 52, offset print) pp. 41-71. 7. Nagashima Osamu, 'Daiichiji taisengo nih on no tekko ryutsukiko (The distribution system of the Japanese iron and steel industry in the post• World War I period)', Kyoto Daigaku Keizai Ronso, vol. 118, nos. 5-6 (I 977). During the war, Yawata refrained from designating exclusive agents, because of the criticism that Yawata as a state-owned works should not exclude smaller dealers. But the extraordinary speculation during the war and the sudden slump afterwards finally swept smaller and makeshift merchants away. So Yawata again came to use larger trading companies as exclusive agents. 8. Okazaki Tetsiji, '1920 nendai no Tekko seisaku to Nippon tekkogyo (Govern• ment policy and the Japanese iron and steel industry in the 1920s)', Tochiseido Shigaku, vol. 103, (1984). This article, analysing the process of the merger controversy in the 1920s, opposes the common view that Mitsui and Mitsubishi supported the merger. 9. Ibid., pp. 9-10. 10. 'Seitetsu chosakai no toshin (A report of the investigation committee on the iron and steel industry)', quoted in MIT! (ed.), Shoko seisakushi, pp. 230-232. II. The establishment of the Ministry of Commerce and Industry is welt described in MIT! (ed.), Shoko Seisakushi, Gyosei kiko, Vol. 3 (A history of commercial and industrial policy organization Vol. 3) (Tokyo: Shoko Seisakushi Kanko Iinkai, 1962), pp. 174-188; and in Chalmers Johnson, MIT/ and the Japanese Miracle: The Growth of Industrial Policy, 1925- /975, (Stanford: Stanford University Press, 1982) pp. 83-115. 12. Hashimoto Juro, Daikyokoki no nihon shihonshugi (Japanese capitalism during the period of the Great Depression) (Tokyo: University of Tokyo Press, 1984) p. 97. 13. MITI (ed.), Shoko seisakushi (tekkogyo), (1970). pp. 236-7. 14. Johnson, MIT/ and the Japanese Miracle, pp. 109-13. 15. Ibid., p. 98. Notes and References 295

16. MITI (ed.), Shoko seisakushi, pp. 270-71; and Yawata Seitetsu Kabushiki• kaisha (ed.), Yawata seitetsusho goju nenshi (A 50-year history of the Yawata Works) (Tokyo: Yawata Seitetsu Kabushiki-kaisha, 1951) p. 14. 17. Nakai Reisaku, Tetsu to watashi: Hanseiki no kaiso (Steel and 1: A memoir of my life) (Tokyo: Tekko to Kinzoku-sha, 1956) p. 69 and p. 110. 18. MITI (ed.), Shoko seisakushi, p. 243. 19. Nishikawa Hiroshi, Nihon teikokushugi to mengyo (Japanese imperial• ism and the cotton industry) (Kyoto: Mineruba Shobo, 1987) p. 93. 20. MITI (ed.), Shoko seisakushi, pp. 241-2. 21. Ibid., p. 267. Compared with the lower steel production cost, as the Japanese iron production cost was relatively higher than the international level, the tariff increase on imported iron would have impeded the cost com• petitiveness of steel. Therefore, the steel industry opposed the govern• ment proposal. 22. Ibid., p. 244. 23. Muto Sanji 's address at the 51st Diet, is quoted in MITI (ed.), Shoko seisakushi, p. 245. 24. After Muto entered politics in 1924, he criticised the corrupt relations between the government and political merchants, particularly the zaibatsu. See Kobayakawa Yoichi, 'Muto Sanji', Nippon no kigyoka, 2 (The Japa• nese entrepreneurs, vol. 2) (Tokyo: Yuhikaku, 1978). 25. Nagashima Osamu, Senzen nihon tekkogyo no kozo buseki (A structural analysis of the Japanese iron and steel industry in the pre-World War II period) (Kyoto: Mineruba Shobo, 1987) p. 174. 26. Nakura Bunji, Nihon tekkogyoshi no kenkyu (A study of the Japanese iron and steel industry) (Tokyo: Ochanomizu Shobo, 1984) pp. 545-6. The description of the subsidies for the Manchurian firms is based on this book (pp. 534-76). 27. Iida et a/. (ed.), Gendai Nippon sangyo hattatsushi: Tekko 4 (A history of modern Japanese industries: Iron and steel, vol. 4) (Tokyo: Kojunsha, 1969), pp. 272-3. In 1932, for example, the average Japanese iron price per ton was 37 yen, while Anshan's was 27 yen. As SMRC was a semi• public corporation, it was compelled to join the cartel following govern• ment orders, even if it would have been more advantageous to be an outsider. 28. Sentetsu Kyohan Gyoseki Henshu Iinkai (ed.), Honpo sentetsu tosei hanbaishi (A history of the controlled sale of iron and steel) (Tokyo: Daiichi Shobo, 1941) p. 40. 29. Ibid., pp. 44-5. 30. Ibid., pp. 53-4. 31. Okazaki Tetsuji, 'Sentetsu kyodotai (The Pig Iron Cooperative Associa• tion)', in Hashimoto, J. and H. Takeda (eds), Ryotaisenkanki no Nippon no kanlleru (Japanese cartels between the world wars) (Tokyo: Ochanomizu Shobo, 1985) pp. 70-72. 32. By 1929, iron production increased to 1 875 000 from 1 309 000 tons in 1926, while steel production increased to 2 034 000 from l 256 000 tons. Scrap consumption rose to I 132 000 from 659 000 during the same period. See Iida et al., Gendai nihon sangyo hattatsushi, p. 275 (Table 111-82). 33. The Joint Purchase Association was formed by the steel firms to bargain 296 Notes and References

with the iron cane! in 1927. Minobe Katsukichi, Karuteru, torasuto, kont• serun (Cartel, trust, and concern) (Tokyo: Kaizosha, 1931) pp. 107-111. 34. lida et al. (ed.), Gendai nihon sangyo hattatsushi, p. 276. 35. MITI (ed.), Shoko seisakushi, pp. 273-4. 36. A. D. Chandler, The Visible Hand (Cambridge: Harvard University Press, 1977) pp. 315-44. 37. In 1933, the iron production capacities of Kamaishi, Wanishi, Kenjiho, Anshan, and Ben Xi Hua were 252 000, 237 000, 280 000, 280 000 and 130 000 tons, respectively. Compared with the I 188 000 tons of the Yawata Works, we can understand how small these companies were in capacity. 38. For example, Osaka Steel reduced its production cost of steel bars to 96.6 yen per ton in 1925 from 115.9 yen per ton in 1922, while Yawata trimmed its cost to 97 .I from 113.5 yen. (Okazaki Tetsuji, 'Kanto kozai hanbai kumiai to kozai rengo kai (A case analysis of two important steel cartels), in Hashimoto and Takeda (eds), Ryotaisenkanki, p. 95. 39. Ibid., p. 103. 40. In addition to the detailed studies of Japanese cartel organisation by Iida et al. and Okazaki, Lynn and McKeown recently published a com• parative study of trade associations in the United States and Japan. See Leonard Lynn and Timothy McKeown, Organising Business: Trade As• sociations in America and Japan (Washington D.C.: American Enter• prise Institute for Public Policy Research, 1988). 41. Oe Shinobu, Showa no rekishi Ten'no no guntai (Showa history: The Emperor's Army) (Tokyo: Shogakkan, 1982) pp. 158-66; Mark Peattie, Jshiwara : Japan's Confrontation with the West (Princeton: Princeton University Press, 1975) pp. 87-91; and Reischauer and Craig, Japan: Tradition and Transformation (Boston: Houghton Mifflin, 1978) p. 242. 42. Nakamura Takafusa, Nihon keizai, sono seicho to kozo (The Japanese economy: Its development and structure), 2nd edition (Tokyo: Univer• sity of Tokyo Press, 1981) pp. 121-2. 43. MITI (ed.), Shoko seisakushi, p. 285. 44. Chalmers Johnson, MIT/ and the Japanese Miracle: The Growth of In• dustrial Policy 1925-1975 (Stanford: Stanford University Press, 1982). 45. Ibid., p. 112. Johnson note, 'If Yoshino will always be identified with industrial "self-control," Kishi will always be identified with state-con• trol of Industry'. In the late 1930s, Kishi became a strong supporter of the state-controlled economy, and he was invited to Manchuria to ex• periment with his idea of a controlled economy. 46. Ibid., p. 108. 47. The Important Industries Control Law has been regarded as a supportive tool of monopolistic cartels. A recent detailed study concluded, however, that the law effectively regulated the monopolistic abuse of price increases and contributed to the increase of international competitiveness. See Hashimoto Juro, Daikyokoki no nihon shihon shugi (Japanese capital• ism in the period of the Great Depression) (Tokyo: University of Tokyo Press, 1984) pp. 345-54. 48. Johnson, MIT/ and the Japanese Miracle, p. 113. 49. MITI (ed.), Shoko seisakushi, pp. 287-8. Notes and References 297

50. Reischauer and Craig, Japan, pp. 245-6. 51. Nakamura, Nihon keizai, sono seicho to kozo, pp. 125-6. 52. Ibid., p. 125. This is the reason Takahashi was called Japan's Keynes. 53. Nagashima, Senzen nihon tekkogyo no kozo bunseki, p. 291. In 1930, the Indian Government increased tariffs on cotton cloth by 15 per cent and added 5 per cent to any cotton cloth made anywhere other than England. This was a preferential tariff to exclude Japanese cotton from the Indian market. 54. MITI (ed.), Shoko seisakushi, p. 294. 55. Nakai, Tetsu to watashi, p. 125. Nakai mentions in his memoirs, 'The tariff increase facilitated rationalization as its precondition on the one hand, and raised the profitability and evaluated value of the iron firms, on the other hand, thus making the consolidation possible.' 56. Ibid., p. 124. 57. Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nippon Seitetsu Kabushiki-kaishashi (A Steel Corporation) (Tokyo: Nihon Seitetsu Kabushiki-kaisha-shi Henshu Iinkai, 1959) p. 41. 58. At the 64th Diet, Nakai mentioned these companies as potential partici• pants. 'The 64th Diet Record', in Nihon Seitetsu Kabushiki-kaisha setsuritsu shiryo-sho, 1 (Internal documents on the establishment of Japan Steel Corporation, vol. 1) p. 39. 59. Nakai, Tetsu to watashi, pp. 148-50. 60. See Nakura Bunji, Nihon tekkogyoshi no kenkyu (A study of the history of the Japanese iron and steel industry) (Tokyo: Kondo Shuppansha, 1984) pp. 576-613. 61. Hashimoto also argues the importance of the privatisation in his book. Hashimoto, Daikyokoki no Nihon Shihoushugi, p. 308. 62. Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nihon Seitetsu Kabushiki-kaishashi, p. 45; and 'The 64th Diet Record', in Nihon Seitestu kabushiki-kaisha setsuritsu shiryo-sho, l (Internal documents on the es• tablishment of Japan Steel Corporation, vol. 1), 1936, p. 21. 63. Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nihon Seitetsu Kabushiki-kaishashi, p. 51. Six bureaucrats, six Diet members, the Presi• dent of Industrial Bank of Japan, six scholars, an accountant, and two tem• porary members (one was Chief Engineer of Yawata) were designated. 64. Ibid., pp. 53-4. The committee reported that in 1928 the amount of in• vestment per ton of ViS. Steel was 200 yen, that of Bethlehem was 167 yen, the average amount of 21 American iron and steel producers was 194 yen, and that of Vereinigte Stahlwerke (United Steel) in Germany was 84 yen in 1926. In Japan, the investment amount per ton of Yawata (land not included) was 120 yen and the average amount of the ten pri• vate firms was 226 yen. In order to increase competitiveness and to pre• vent the inflating of assets, the committee compressed the amount to around 61 yen. 65. Nihon Kokan Kabushiki kaisha, Nihon kokan kabushiki-kaisha rokujunen• shi (A sixty year history of NKK) (Tokyo: NKK, 1973) p. 144. 66. For example, see Nakura, Nihon tekkogyoshi no kenkyu, p. 605. 67. Hashimoto has a same view as this book does, see Hashimoto, Daikyokoki no nihon shihonshugi, pp. 312-5. 298 Notes and References

68. 'The 64th Diet Record', in Nihon seitetsu kabushiki kaisha setsuritsu shiryo-sho, p. 39. 69. Nippon Seitetsu Kabushiki-kaisha, Nihon seitestu kabushiki kaishashi, p. 47. 70. The MCI intervened in price increases of the industry at the expense of the newly formed Japan Steel Corporation and in fact after the consoli• dation the iron and steel prices became stable through the 1930s. Hashimoto, Daikyokoki no nihon shihonshugi, pp. 316-21. 71. The 64th Diet Record, in Nihon seitetsu kabushiki kaisha setsuritsu shiryo- sho, pp. 389-90. 72. Ibid., pp. 417-22. 73. Nakai, Tetsu to watashi, p. 157. 74. A. D. Chandler, Strategy and Structure: Chapters in the History of the American Industrial Enterprise (Cambridge: MIT Press, 1962), chapters 2 and 3. 75. Nippon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nihon seitetsu kabushiki-kaishashi, p. 48. 76. Nihon Kokan Kabushiki-kaisha (ed.), Nihon kokan kabushiki-kaisha rokuju• nen-shi (A 60 yeur history of NKK) (Tokyo: NKK, 1972) p. 144. 77. Ibid., p. 57. Also, it should be noted that since Shiraishi was the son-in• law of Asano Soichiro, the founder of the Asano zaibatsu, there was some coordination in the decision-making between NKK and Asano's companies. 78. Hashimoto, Daikyokoki no nih on shihonshugi, p. 310-11. 79. Fuji Seitetsu Kabushiki-kaisha Kamaishi Seitetsu-sho (ed.), Kamaishi seitetsu-sho nanajunen-shi (A 70-year history of the Kamaishi Works) (Tokyo: Fuji Seitetsu Kabushiki kaisha, 1955) p. 493. 80. Hatate Isao, Nihon no zaibatsu to Mitsubishi (Japanese zaibatsu and Mistubishi) (Tokyo: Gakuyu sha, 1985) p. 331. 81. NKK (ed.), Nihon kokan kabushiki-kaisha rokuju-nen-shi, p. 145. 82. Hashimoto, Daikyokoki no nihon shihonshugi, pp. 299-300. 83. Seitetsu Kyohan Gyoseki Hensan Iinkai (ed.), Honpo sentetsu tosei hanbaishi (A history of the pig iron controlled sales company) (Tokyo: Dai-ichi Shobo, 1941) p. 514. 84. Nihon Seitetsu Kabushiki- kaishashi Henshu Iinkai (ed.), Nihon seitetsu kabushiki-kaishashi, p. 75. 85. MITI (ed.), Shoko seisakushi, p. 316; and Hashimoto, Daikyokoki no Nihon shihonshugi, pp. 316-18. 86. For the organisational structure and managerial hierarchy. see Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nihon Seitetsu Kabu• shiki-kaishashi, pp. 679-94.

7 THE SECOND WORLD WAR AND THE CONTROLLED ECONOMY

I. Iida et a/. (eds), Gendai nihon sangyo hattatsushi: Tekko (A history of modern Japanese industries: Iron and steel) pp. 318-19. 2. By controlling the domestic iron price, the MCI unintentionally encouraged Notes and References 299

the import of scrap and the subsequent high profits of the steel pro• ducers. See Okazaki Tetsuji, 'Nicchu senso zenhanki ni okeru keizai no keikakuka to tekko bumon (Economic planning and the iron and steel sector in the early China War)', Shakaikagaku Kenkyu, 41: 3 (1989). 3. The price of imported pig iron per ton in 1933, 1934, and 1935 was 39.4, 43.2, and 43.5 yen, respectively, while that of scrap was 38.2, 46.5, and 49.8 yen, respectively (see lida et a/. (eds), Gendai nihon sangyo hattatsushi, p. 326). Compared with pig iron, scrap brought double pro• ductivity and quality to the non-integrated steel producers. 4. MITI (ed.), Shoko seisakushi: Tekkogyo, 17 (A history of commercial and industrial policy: Iron and steel, vol. 17) (Tokyo: Shoko Seisakushi Kanko-kai, 1970) p. 317. 5. Nihon Seitetsu Kabushiki-kaisha Shashi Hensan Iinkai (ed.), Nihon Seitetsu Kabushiki-kaisha shi (A history of Japan Steel Corporation) (Tokyo: Nihon Seitetsu Kabushiki-kaisha Shashi Hensan Iinkai, 1959). 6. Chalmers Johnson, MIT/ and the Japanese Miracle (Stanford: Stanford University Press, 1982) p. 128. 7. MITI (ed.), Shoko seisakushi, p. 321. 8. Only in Britain, Richard Thomas Company was planning to introduce the continuous strip mill at that time (see Nihon Seitetsu Kabushiki-kaisha Shashi Hensan linkai (ed.), Nihon Seitetsu Kabushiki-kaisha shi, p. 101). 9. Asawa Saburo (ed.), Showa seiko-sho nijunen-shi (A 20-year history of Showa Steel) (Anshan: Kabushiki-kaisha Showa Seiko-sho, 1937) pp. 10-25. 10. MITI (ed.), Shoko seisakushi, pp. 324-30. 11. MITI (ed.), Shoko seisakushi, pp. 331-3. These industries were the weap• onry, aircraft, automobile, machine tool, iron and steel, liquid fuel, coal, machinery, aluminium, magnesium, shipbuilding, electric power, and rolling stock industries. 12. Okazaki Tetsuji, 'Nicchu senso zenhanki', p. 108. 13. Ibid., pp. 112-13. 14. Chalmers Johnson, MIT/ and the Japanese Miracle, pp. 136-56. 15. Okazaki, 'Nicchu senso zenhanki', p. 118. The demand forecast in 1938 was cut by 3 per cent. 16. The firms were Japan Steel, NKK, Sumitomo, Kawasaki, Kobe, Nakayama, Agatsuma, Amagasaki, Osaka Seiko, Osaka Seihan, Daiwa, Miya, Tokai, Tokuyama Teppan, Nihon Aentokogyo, Kokura, and Tsurumi. See Nagashima Osamu, Nihon senji tekko tosei seiritsu-shi (A history of the controlled iron and steel industry during the war) (Kyoto: Horitsu Bunkasha, 1986) p. 135. 17. The establishment process and organisation of the Japan Steel Materials Sales Federation are well described in Nagashima, Nihon senji tekko tosei seiritsu-shi, pp. 136-44. 18. Nakamura Takafusa, The Postwar Japanese Economy: Its Development and Structure (Tokyo: University of Tokyo Press, 1981) pp. 6-7. 19. Nagashima, Nihon senji tekko tosei seiritsu-shi, pp. 145-51. 20. Okazaki, 'Nicchu senso zenhanki', p. 129. 21. Fairbank, Reischauer, and Craig, East Asia: The Modern Transformation (Boston: Houghton Mifflin, 1965) p. 607. 300 Notes and References

22. Okazaki Tetsuji, 'Dainiji sekai taisenki no nihon ni okeru senji keikaku keizai no kozo to unko (The structure and practice of the war-based economy during the world war II period)', Shakai Kagaku Kenkyu 40: 4 ( 1988) pp. 89-90. This tendency is also often seen in socialist countries. 23. Ibid., pp. 7-10. 24. Ibid., p. 14. 25. Ibid., pp. 14-17. These complicated conflicts of interest and the process of the establishment of the Japan Iron and Steel Raw Material Control Corporation are well described by Okazaki. 26. See Akagi Suruki, 'Kokumin saisoshiki (A reorganization of the nation)', in Nihon Seiji Gakkai (ed.), Konoe shin taisei no kenkyu (A study of Konoe' s new structure) (Tokyo: Iwanami Shoten, 1972) pp. 20-70. 27. Nakamura Takafusa and Hara Akira, 'Keizai Shin-taisei (The new econ• omic structure)', in Ibid., pp. 71-133. 28. On Ryu and his theory, see Ryu Shintaro, Nihon keizai no saihensei (The reorganization of the Japanese economy) (Tokyo: Chuo Koron-sha, 1941) and Nakamura Takafusa, Nihon no Keizai Tosei, pp. 89-102. 29. The debate over the issue and the battle between the business world and the Cabinet Planning Board are well covered in Johnson, MIT/ and the Japanese Miracle, pp. 150-56. 30. Shibagaki Tsuneo, 'Keizai shin-taisei to toseikai (The New Economic Structure and the control associations)', Senji Nihon Keizai, vol. 2 (ed.), Tokyo Daigaku Shakaikagaku Kenkyusho (Tokyo: University of Tokyo Press, 1979) pp. 316-25. Shibagaki points out that the established con• trol association was a result of the compromise between the CPB and the business world. 31. Okazaki, 'Nicchu senso zenhanki', pp. 47-9. 32. Johnson, MIT/ and the Japanese Miracle, p. 162. 33. Okazaki, 'Nicchu senso zenhanki', p. 131. 34. The analysis of the Iron and Steel Control Association in this book is indebted to Okazaki Tetsuji's pioneering work, 'Dainiji sekai taisenki no Nihon ni okeru senji keikaku keizai no kozo to unko (The structure and practice of the war-based economy during the world war II period).' 35. Ibid., p. 22. 36. Ibid., p. 74. Tokai Kogyo, Nihon Kogyo, and Fuso Kogyo were reorgan• ised under the wing of Japan Steel as sub-contractors. 37. Ibid., pp. 84-6. The change was forced by the association on almost all non-integrated firms simultaneously and homogeneously. 38. Ibid., pp. 103-8. 39. Ibid., p. 109. 40. See Johnson, MIT/ and the Japanese Miracle, p. 169. 41. The strategy and structure of Japan Steel described here are based on Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nihon seitetsu kabushiki-kaisha shi, pp. 84-179. 42. The history of NKK is based on Akasaka Takeshi (ed.), Nihon kokan kabushiki-kaisha yonjunen-shi (A 40-year history of NKK) (Tokyo: Nihon Kokan Kabushiki-kaisha, 1952). 43. The histories of KHI and Nishiyama Yataro are based on Kawasaki Jukogyo Kabushiki-kaisha Shashi Hensan-shitsu (ed.), Kawasaki jukogyo kabushiki- Notes and References 301

kaishashi (A history of Kawasaki Heavy Industries) (Kobe: Kawasaki Jukogyo Kabushiki-kaisha, 1959); Kawasaki Seitetsu Kabushiki-kaisha (ed.), Kawasaki seitetsu nijugonen-shi (A 25-year history of Kawasaki Steel) (Tokyo: Kawasaki Seitetsu Kabushiki-kaisha, 1976); and Tekko Shinbunsha (ed.), Tekko kyojin den Nishiyama Yataro (The biography of Nishiyama Yataro) (Tokyo: Tekko Shinbunsha, 1971). 44. Kawasaki Seitestu Kabushiki-kaisha, 'Daisankai shashi hensan no tame no kiroku (The third round-table talks regarding company history), (April, 1971) An internal document of Kawasaki Steel at the Tokyo headquar• ters. 45. The histories of Kobe and Sumitomo are based on Shinko Goju-nenshi Hensan Iinkai (ed.), Shinko goju-nenshi (A 50-year history of Kobe Steel) (Kobe: Shinko Gojunen-shi Hensan Iinkai, 1954); and Sumitomo Kinzoku Kogyo Rokujunen-shoshi Hensan Iinkai (ed.), Sumitomo kinzoku kogyo rokujunen-shoshi (A 60-year history of Sumitomo Meta/Industries) (Osaka: Sumitomo Kinzoku Kogyo, 1957). 46. Tekko Shinbunsha (ed.), Tekko kyojinden Asada Chohei (A biography of Asada Chohei) (Tokyo: Tekko Shinbunsha, 1982). 47. Johnson, MIT/ and the Japanese Miracle, pp. 167-8. 48. Okazaki, 'Nicchu sen so zenhanki', p. 109. 49. Hoashi Kei, Toseikeizai no riron to jissai (Theory and practice of the control association) (Tokyo: Shinkeizai Shuppansha, 1941) p. 15.

8 THE POSTWAR STRUGGLE OF THE INDUSTRY

I. Thomas B. McCraw (ed.), America versus Japan (Boston: Harvard Busi• ness School Press, 1986) p. 93. 2. Nagano Shigeo, Watakushi no rirekisho (My memoirs) (Tokyo: Nikkei Shinbunsha, 1980) p. 56. 3. A round-table talk among steel executives, in Nihon Tekko Renmei Sengo Tekkoshi Henshu Iinkai (ed.), Sengo tekkoshi (A history of the postwar iron and steel industry) (Tokyo: Nihon Tekko Renmei, 1959), Appendix p. 9. 4. Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nihon Seitetsu Kabushiki-kaishashi (A history of Japan Steel Cmporation) (Tokyo: Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai, 1959) p. 334 and p. 361. 5. Financial History Section of Ministry of Finance (ed.), The Financial History of Japan: The Allied Occupation Period, 1945-1952, Vol. 20 (Tokyo: Toyo Keizai Shinposha, 1982) p. 435. 6. 'Reparations from Japan-Immediate Program (Pauley Interim Report)', in ibid., pp. 443-9. 7. Nihon Tekko Renmei Sengo Tekkoshi Henshu Iinkai (ed.), Sengo tekkoshi, pp. 25-7. 8. Nihon Seitetsu Kabushiki-kaishashi Henshu Iinkai (ed.), Nihon Seitetsu Kabushiki-kaishashi (A history of Japan Steel Corporation) p. 184. 9. A letter to the Secretary of State from Max Bishop, Office of the United States Political Adviser in Financial History Section of Ministry of Fi• nance (ed.), The Financial History of Japan, pp. 496-7. 302 Notes and References to. Ibid., p. 472. The interim directive did not materialise but added to the industry's insecurities. II. In the late nineteenth century, the United States, Germany, Belgium, and France used similar measures to foster their iron and steel industries, see Kent Jones, Politics vs Economics in World Steel Trade (London: Allen & Unwin, 1986). Also, we have good examples in the Indian iron and steel industries of governments failing to protect their industries with these conventional measures, seeK. Moorty, Engineering Change, India's Iron and Steel (Bombay: Technology Books, 1984). 12. Miwa Ryoichi, 'Sengo minshuka to keizai saiken (Democratization and economic recovery in the postwar period)', in Nakamura Takafusa (ed.), Nihon keizaishi: Keikakuka to minshuka (Japanese economic history: Planning and democratising) (Tokyo: Iwanami Shoten, 1988) pp. 108-164. 13. Nihon Tekko Renmei Sengo Tekkoshi Henshu linkai (ed.), Sengo tekkoshi, p. 59. 14. Nishiyama Kinen Jigyokai (ed.), Nihsiyama Yataro Tsuito-shu (Remi• niscence of Nishiyama Yataro) (Kobe: Kawasaki Seitetsu Kabushiki-kaisha, 1963) pp. 262-3, and Tekko Shinbunsha (ed.), Tekko Kyojinn-den: Nishiyama Yataro (Biography of Nishiyama Yataro) (Tokyo: Tekko Shinbunsha, 1971) p. 298. 15. There were a few people in MITI and the industry, however, who sup• ported Nishiyama's decision from the viewpoint of international com• petitiveness and technological development. Tabata Shintaro, MITI's Steel Section Chief at that time, strongly supported Nishiyama's plan and even Yamaoka Takeshi, Chief Engineer and Managing Director of Yawata Steel, supported Nishiyama's plan and became a private technical adviser to him. But they were not in the majority at that time. 16. A part of this section was published in Yonekura Seiichiro, 'Postwar Reform of Management and Labour', in J. Teranishi andY. Kosai (eds), The Japanese Experience of Economic Reforms (New York: St Martin's Press, 1993). 17. Eleanor Hadley, Antitrust in Japan (Princeton: Princeton University, 1970) pp. 84-8. 18. Ibid., pp. 89-90. 19. Noda Kazuo, 'Postwar Japanese Executives', in Komiya Ryutaro (ed.), Postwar Economic Growth in Japan (Robert S. Ozaki, trans.) (Berkeley: University of California Press, 1966) pp. 233-4. 20. 'Behind the Japanese Purge-American Military Rivalries', Newsweek, 27 January 1947. 21. Hadley, Antitrust in Japan, p. 95. 22. Ibid., p. 92. 23. Noda, 'Postwar Japanese Executives', p. 235. 24. Michael Yoshino, Japan's Managerial System: Tradition and Innovation (Cambridge: MIT Press, 1968) p. 87. 25. Ibid., p. 90. 26. Wakimura Yoshitaro, 'Sengo keieishi no shuppatsuten: Zaibatsu kaitai (Dissolution of the zaibatsu)', Hitotsubashi Business Review, vol. 31, no. 2 (1983) p. 96. 27. For more details on Toyoda and Watanabe, see Nihon Seitetsu Kabushiki· kaishashi Henshu linkai (ed.), Nihon seitetsu kabushiki-kaisha-shi (A Notes and References 303

history of Japan Steel Corporation) (Tokyo: Nihon Seitetsu Kabushiki• kaishashi Henshu Iinkai, 1959). 28. See Nihon Kokan Kabushiki-kaisha Rokuju-nenshi Hensan Iinkai (ed.), Nihon kokan kabushiki-kaisha rokujyu-nenshi (A 60-year history of NKK) (Tokyo: Nihon Kokan Kabushiki-kaisha, 1972). 29. For more details on ltani, see Kyuju-nen Shoshi Henshu Iinkai (ed.), Kyuju-nen no ayumi: Kawasaki jyukogyo-shoshi (A 90-year history of KHI) (Tokyo: Daiamondo-sha, 1986). 30. Sumitomo Kinzoku Kogyo (ed.), Kasuga Hiromu tsuikairokll (Reminiscences of Kasuga Hiromll) (Osaka: Sumitomo Kinzoku Kogyo Kabushiki-kaisha, 1974). 31. For more details on Tamiya and Asada, see Shinko Goju-nenshi Hensan Iinkai (ed.), Shinko goju-nenshi (A 50-year history of Kobe Steel) (Kobe: Shiko Goju-nenshi Hensan Iinkai, 1954). 32. Tekko Shinbunsha (ed.), Tekko kyojin-den: Miki Takashi (A biography of Miki takashi) (Tokyo: Tekko Shinbunsha, 1973). 33. Kawada Shige, Watakushi no rirekisho (My memoirs) (Tokyo: Nihon Keizai Shinbunsha, 1980) p. 471. 34. Hoshino Yoshiro, 'Sengo gijutsushi no jidai kubun (A technological history of postwar Japan)', in Nakayama Shigeru (ed.), Nihon no gijutsuryoku (The technological potential of Japan) (Tokyo: Asahi Shinbunsha, 1986) p. 87. 35. See Miyazaki Yoshikazu, Sengo nihon no keizai kiko (The economic in• stitutions of postwar Japan) (Tokyo: Shin-hyoron, 1966) pp. 33-71; and Nakamura Takafusa, The Postwar Japanese Economy, (Tokyo: Univer• sity of Tokyo Press, 1981) p. 145. 36. Yamazaki Hiroaki, 'Senjika no sangyo kozo to dokusen sosiki (An in• dustrial structure and monopoly during the war)', in Tokyo Daigaku Shakai Kagaku Kenkyusho (ed.), Senji nihon keizai (The Japanese economy during the war) (Tokyo: University of Tokyo Press, 1979) pp. 217-89. 37. See Yonekura Seiichiro, 'Sengo nihon tekkogyo ni okeru Kawasaki seitetsu no Kakushin-sei (The Entrepreneurship and innovative behavior of Kawasaki Steel in the postwar period)', Hitotsubashi Ronso, vol. 93, no. 3 (1983 ).

9 A NEW COMPETITIVE MODEL AND INNOVATIONS: THE DEVELOPMENT OF THE INDUSTRY

l. Nihon Tekko Renmei Sengo Tekkoshi Henshu linkai (ed.), Sengo tekkoshi (A history of the postwar iron and steel industry) (Tokyo: Nihon Tekko Renmei, 1959) pp. 43-5. 2. Ibid., pp. 174-7. 3. MITI (ed.), op. cit., (1970) pp. 504-5. 4. Tsuruta Masatoshi, Sengo nihon no sangyo seisaku (The industrial policy of postwar Japan) (Tokyo: Nihon Keizai Shinbunsha, 1982) p. 53. 5. It was well known that the American and German governments promoted rapid depreciation in the iron and steel industry after the war. The In• dian government and the World Bank provided low-cost loans to the 304 Notes and References

Indian iron and steel industry, but it did not grow as much as they ex• pected. The developing countries have all tried the same government aids as Japan. See, Miyazaki, Sengo nihon, pp. 39-43; K. Moorthy, En• gineering Change: India's Iron and Steel (Bombay: Technology Books, 1984); and T. Howell et al. Steel and the State: Government Interven• tion and Steel's Structural Crisis (Boulder: Westview, 1988). 6. In fact, the export of crude steel tripled to 366,500 tons and that of steel materials increased 44 per cent to 1.32 million tons in 1955. 7. lida et al. (eds), Gendai nihon sangyo hattatsushi, IX tekkogyo, p. 447. Kawasaki Seitetsu Shashi Henshu Iinkai (ed.), Kawasaki seitetsu nijyu• go nenshi (A 25-year history of Kawasaki Steel) pp. 107-9, describes how the Chiba Works increased productivity and efficiency in iron and steelmaking. 8. Nihon Tekko Renmei Sengo Tekkoshi Henshu Iinkai (ed.), pp. 204-5. 9. Kawasaki Tsutomu, Sengo tekkogyo ron (The postwar iron and steel in• dustry) (Tokyo: Tekko Shinbunsha, 1968) p. 115. There was a scheme known as 'Planned Shipbuilding' (keikaku zosen) by which a govern• ment shipping corporation (Senpaku Kodan) ordered and bought ships and then leased them to shipping companies. As the shipping companies generated profits, they paid for the leases and the corporation used these funds to order more ships. See Ezra Vogel, Comeback (New York: Simon and Schuster, 1985) pp. 35-57. 10. See Leonard Lynn, How Japan Innovates: A Comparison with the U.S. in the Case of Oxygen Steelmaking (Boulder: Westview Press, 1982). 11. Iida et al. (eds), pp. 452-3. 12. Thomas McCraw (ed.), America versus Japan (Boston: Harvard Business School Press, 1986) pp. 97-8. 13. Lynn, How Japan Innovates, pp. 67-89. 14. The theory of technological imbalance is from Nathan Rosenberg, Per• spective in Technology (Cambridge: Cambridge University, 1976). Mate• rial regarding the innovativeness of continuous casting and the adoptive process of the CC is from Yonekura Seiichiro, 'Recognizing Potential in Innovations: Armco vs. Kawasaki', Discussion Paper no. 131, Insti• tute of Business Research, Hitotsubashi University, 1988. 15. In a consideration of the industry's postwar development, the role of the blue-collar worker should not be neglected. The absence of a dis• cussion of labour's role in the industry's development is due to the exigencies of time and space, not to a lack of appreciation of its import• ance. For a treatment of this subject, see Nonaka Ikujiro and Yonekura Seiichiro, 'Innovation Through Group Dynamics: Organizational Learning in JK Activity at Nippon Steel's Kimitsu Works', Discussion Paper no. 124, Institute of Business Research, Hitotsubashi University, 1985; and Yonekura Seiichiro, 'Recognizing Potential in Innovations: Armco vs. Kawasaki.' 16. See Nakamura Takafusa, The Postwar Japanese Economy, pp. 111-150. 17. lida et al. (eds), Gendai nihon sangyo hattatsushi, p. 479. 18. Chandler, Scale and Scope, pp. 23-4. Chandler emphasises managerial coordination in achieving a minimum efficiency scale. I agree with his emphasis, but in the Japanese iron and steel industry, in order to under• stand the fierce competition for market share, we must also consider Notes and References 305

MES in the context of the relationship of minimum optimal scale to market share. See Chandler's note on MES in, ibid., p. 734. 19. Iida et a/. (eds), Gendai nihon sangyo hallatsushi, p. 476. 20. Inayama Yoshihiro, Watashi no tekko Showa-shi (My history of the steel industry in the Showa period) (Tokyo: Toyo Keizai Shinposha, 1986) pp. 32-43, and p. 122. 21. See McCraw, America versus Japan, p. 95. 22. lmai Ken'ichi, Gendai sangyo soshiki (Modern industrial organization) (Tokyo: Iwanami Shoten, 1976). 23. To understand how fierce competition in the higher end of the market was, see Iida eta/. (eds), pp. 567-8. 24. Tanaka Yonosuke, Hyuga Hosai ron (An essay on Hyuga Hosai) (Tokyo: Raifu Sha, 1975) p. 125. 25. Ibid., pp. 148-9. 26. See Johnson, pp. 275-304 27. Mainichi Shinbun Keizaibu (ed.), Shin-nittetsu tanjosu (The birth of Nip• pon Steel) (Tokyo: Mainichi Shinbunsha, 1970) p. 29. 28. Ibid., p. 43. 29. lida et al. (eds), Gendai nihon sangyo hallatsushi, pp. 585-6. During the 1960s, the industry sulfered from oversupply and the cyclical demand cycle. 30. Tanaka Yonosuke, Hyuga Hosai non, p. 176. 31. On the international merger movement, see Howell et al., Steel and the State, pp. 55-189. 32. Mainichi Shimbun Keizaibu (ed.), Shinnittetsu tanjousu, pp. 167-87.

10 DIVERSIFICATION AND GLOBALISATION: STRUGGLE FOR SURVIVAL

l. lmai Ken'ichi, Gendai sangyo soshiki (Modern industrial organization) (Tokyo: Iwanami Shoten, 1976) pp. 153-179. 2. Nakamura Takafusa, The Postwar Japanese Economy: Its Development and Structure (Tokyo: University of Tokyo Press, 1981) p. 212. 3. Ibid., p. 223. 4. Tekko Jyu-nenshi Henshu Iinkai (ed.), Tekko jyunenshi, Showa 43-52 (A 10-year history of the iron and steel industry from 1968 to 1977) (Tokyo: Nihon tekko renmei, 1981) pp. 55-7. 5. Kawasaki Tsutomu, Nihon tekkogyo (The Japanese iron and steel indus• try) (Tokyo: Tekko Shinbunsha, 1982) p. 208. 6. Of the ten largest iron and steel works in the world, five were Japanese, four were from the former Soviet Union, and one each from the United States and Italy. See Toda Hiromoto, Gendai sekai tekkkogyo ron (The modern world steel industry) ( Tokyo: Bunshindo, 1984) pp. 30-31. 7. Kawasaki, Nihon tekkogyo, p. 236. 8. Hara Terushi (ed.), Kagakuteki kanri no donyu to tenkai (The introduc• tion and development of scientific management) (Tokyo: Showa-do, 1990). 9. Shin Nihon Seitetsu (ed.), Hono to tomoni: Yawata seitetsu kabushiki• koishashi (A history of Yawata Steel) (Tokyo: Shin Nihon Seitetsu Kabushiki-kaisha, 1981) p. 161. 306 Notes and References

10. Nippon Steel Corporation's Kimitsu Works (ed.), JK Activity (English version) (Tokyo: Shin Nihon Seitetsu Kabushiki-kaisha, 1981) p. 3. 11. Personal interview conducted by Nonaka Ikujiro and Yonekura Seiichiro at the Kimitsu Works in May 1982. 12. Personal interviews by Nonaka Ikujiro and Yonekura Seiichiro in May 1982. 13. Ibid. 14. Iwai Masakazu, Shin nilletsu manpower kakumei - Kimitsu JK katsudo no himitsu (Manpower revolution at Nippon Steel - The secret of JK Activity at Kimitsu Works) (Tokyo: Diamond, 1981). 15. The following three cases are based on our interview record, and Shin Nihon Seitetsu Kabushiki-kaisha (ed.), Chosen no hibi (Everyday chal• lenge) and Iwai Masakazu, ibid. 16. Interview record of July 1982 at the Kimitsu Works. 17. Nonaka Ikujiro and Yonekura Seiichiro, 'Soshiki gakushu toshiteno JK katsudo (JK Activity as organisational learning)', Shogaku Kenkyu, vol. 25 (1983). Our theme in this article is that the Japanese quality control circle movement is organisational learning and has contributed tremen• dously to the incremental innovation process in the manufacturing sec• tors. 18. 'lma mouke no tetsugakuwo', Nikkei Business, 14 November 1983, p. 30. 19. Ibid., p. 32. 20. Ibid., p. 24. 21. Ibid., p. 25. 22. On postwar labour relations in the steel industry, see Yonekura Seiichiro, 'The Postwar Reform in Management and Labour: The Case of the Steel Industry', in J. Teranishi andY. Kosai (eds), Japan's Experience: Econ• omic Reform (London: Macmillan Press, 1993). 23. Kondo Kazuhiro and Murakami Yukio, 'Kimitsu taiwagata puroguramu seisaku sisutemu' (the Kimitsu interactive program generator system), IBM Review, 79, 1980; personal interview with Murakami Yukio, 22 November 1993. 24. On accumulated managerial resources, see ltami Hiroyuki, Mobilizing Invisible Assets (Cambridge: Harvard University Press, 1985). 25. On the relationship between diversification and excessive resources, see Alfred Chandler, Jr., Strategy and Structure (Cambridge: MIT Press, 1965), and Edith Penrose, The Theory of the Growth of the Firm (New York: M. R. Sharpe, Inc., 1980). 26. 'Frontier ni idomu (A challenge to the frontier)', Nikkei sangyo shinbun (Nikkei Industrial News), 2 April 1984. 27. Yonekura Seiichiro, 'Seijuku sangyo no datsu seijyukuka no rironteki wakugumi (A new framework for the de-maturisation of the firm)', Busi• ness Review, vol. 32, no. 2 (1987). 28. My interview record of 20 May 1986, at Nippon Steel. 29. The newly emerged network society has worked effectively to facilitate this kind of strategic alliance. On the alliances and network society, see Imai Ken'ichi and Yonekura Seiichiro, 'Network and Network-in Strat• egy', Institute of Business Research, Hitotsubashi University, Discus• sion Paper no. 131. Notes and References 307

30. 'Kyokan shin-nihon seitetsu sozai kakumei no zen shinario (The whole scenario of a gigantic Nippon Steel's material revolution)', Keizaikai, ll September (1984). 31. My interview record of 1985. 32. Kawasaki Tsutomu, Nihon tekkogyo, pp. 457-8. 33. Ibid., pp. 458-9. 34. In the United States, antidumping complaints against Japan and the EC had been repeatedly filed, and beginning in 1969 Japanese steel firms entered into a voluntary restriction agreement with the US government. After the second oil crisis, the US market again experienced a major increase in steel imports, reaching 18 per cent of the market share. The Carter administration introduced the so-called 'Trigger Price Mechanism (TPM)' proposed by the US Department of Treasury to control imports to around the 15 per cent level. Although the TPM did not work effec• tively, the US government tried to revise it throughout the 1980s. See T. R. Howell et al., Steel and the State: Government Intervention and Steel's Structural Crisis (Boulder: Westview Press, 1988). 35. See Martin Kenney and Richard Florida, Beyond Mass Production: The Japanese System and Its Transfer to the U.S. (Oxford: Oxford Univer• sity Press, 1993), chapter 6. 36. 'Kesu sutadei Nihon Kokan (A case study of NKK)', Nikkei Business, 9 July, 1984, p. 58. 37. Remarks made by Howard M. Love at NII/NKK Press Conference on 22 August 1984 in Pittsburgh. 38. Nikkei Business, 9 July 1984, p. 56. 39. Ibid., pp. 56-7. 40. Kenney and Florida, Beyond Mass Production, p. 172. In the US steel complex there were and still are 300 to 400 job classifications, while at most lO in its Japanese counterpart. These complex classifications alone would impede cooperative team-work. 41. 'Sangyo reportage', Nikkei Sang yo Shinbun, 5 September 1984. 42. NKK's internal document and National Steel Prospectus for 1992. 43. Personal interview record of 9 January 1986. 44. The same observation was made in Robert Hayes, 'Why Japanese Facto• ries Work', Harvard Business Review, July-August 1981, and Kenney and Florida, Beyond Mass Production, pp. 188-90.

11 CONCLUSION: CONTINUITY AND DISCONTINUITY

I. Nihon Seitetsu Kabushiki-kaisha, Nihon Seitestu Kabushiki-kaisha setsuritsu kankei shiryo-sho, I (Internal documents on the establishment of Japan Steel Corporation, vol. I) (Tokyo: Nihon Seitetsu Kabushiki-kaisha, 1936) p. 21. 2. See Yonekura Seiichiro, 'Gyokai dantai no kino to Yakuwari' (Function and Role of Trade Associations), in M. Okuno-Fujiwara and T. Okazaki (eds), Gendai kigyo sisustemi no genryu (Origins of the modern enter• prise system) (Tokyo: Nihon Keizai Shinbunsha, 1993). Bibliography

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Abe Isao 170 basic oxygen furnace (BOF) 9-10, Abe Nobuyuki, General 168 219-22 acid open hearth furnace JK Activity 248-50 process 58 Beehive ovens 40 Akasaka Takeshi 234-5 Belgium Akatani iron ore mines 52, 53 Japanese imports 90 Akiyama Koreyuki, Admiral 52 mergers 237 Amagasaki Steel 208 Oshima Michitaro 37 Amamiya Keijiro 64 Ben Xi Hua Coal and Iron Amaterasu Omikami 229 Company 69, 72-3 Anshan Iron Works 72 government promotion 84 cartel 124 subsidisation 122 establishment 54 Bengal Iron Company 69 iron ore preparation Bessemer, Henry 21 technology I 05 Bessemer converters 45 subsidisation 122 Bianchi Louis 24-5 Anti-monopoly Law 193 blast furnaces, large 107-8, 221 Appleby, Dr W.R. 105 Brazil 262-3 Arisawa Hiromi 167, 193 break-even point 226 Armstrong 33 Nihon Seiko-sho 64-5, 67, 94 Cabinet Planning Board Asada Chohei 186, 190-1, 205, 207 (CPB) 166-8, 172-3, 186-7 Asano Bussan 96 New Economic Structure 175 Asano Kokura 96, 153 price stabilisation proposal 179 Asano Ryozo 203 Cabinet Price Bureau 171 Asano Shipbuilding Canada 10 Corporation 96, 183 Carlowitz and Company 53 Japan Steel Corporation 149 cartelisation 113, 117-20, 124-32 Asano Soichiro 96 Chang Tso Lin 133 Asano zaibatsu 86, 96, 97 Chiba Works 106, 208-11 subsidisation 123 Chikuho Coal Mines 36 Asawa Saburo I 06, 211 China asset evaluation, Japan Steel Ben Xi Hua Coal and Iron Corporation 145-6 Company 69, 72-3 Chugoku Jitsugyo Company 92 Baltic Fleet 52 Han Yeh Ping coal and Iron bank crisis ( 1927) 132 Company 53-4 Bank of Japan 199-200 Hanyang Iron Works 43, 46, 132 52-3 Bar Segments Agreement 129-30, Japanese imports 81, 91 153 military tension 32-3, 35, 138 Basic Bessemer Furnace 183 Yawata Works 55, 82 basic open hearth process 58 China War 165, 174

317 318 Index

Chita Works 184 Diet Chugoku Jitsugyo Company 92 Iron and Steel Business climatic conditions 45 Law 164 cobalt steel I 03 Japan Steel Corporation 141 coke national steel works 33, 34, 35 ovens, energy-efficient 106-7 Yawata Works 50, 52; quality problems 40 expansion 58, 81 Cold War 194 distribution system 75-7 Committee for Research on Steel diversification 259-62 Production 33-4 Dodge, Joseph M. 195-6 computerised process-control Dodge Line 196-7 technology 222, 242 Dutch learning 19-20 consolidation Investigative Committee on the economic growth 57-9, 156-7 Iron and Steel Industry economic purge 200-3 115-16 Economic Stabilization Board 193 Japan Industrial Club 112 economies of scale 4-7 opposition 114 oil crisis 242 Temporary Industrial education 100-3, 206-7 Rationalisation Bureau 135-6 electric furnace continuity, technology I 04-8 adoption 10 continuous annealing and pressing minimills 254-5 line (CAPL) 260-1 energy-efficient coke ovens 106-7 continuous caster ( CC) 9-10, Eto Juzo 67 221-2 European Economic Community (EEC) continuous descaling and cold- economies of scales 4-6 rolling mill (CDCM) 260-1 technological innovations I 0 continuous strip mills 163 exports control association 174-5 1930s 158-9 Coppee ovens 40 1950s 216 cost reduction, Japan Steel Corporation 146-7 Fair Trade Commission Council of Iron and Steel (FTC) 229 Production 35 Nippon Steel Corporation 234, coup d' hat (1936) 161 237 First 1-Beam War 254-5 First Rationalisation Daelen, R.M. 45 Programme 213-15 Daiichi Bank 209 floating tickets 168, 170 Dainihon Seito 63 France Dan Takuma 115, 139 mergers 237 Deconcentration of Excessive productivity I, 2, 3 Economic Power Law 193 protectionism 13 deflation policy 27 Freiberg Mining University demand, iron and steel Oshima Michitaro 37 1910s 79, 80 Oshima Takato 23 1950s 225 Fuji Paper 135 designated price system 129-30, Fuji Steel 86, 198-9 227-8 Asano zaibatsu 96 Index 319

designated price system 28 Han Yah Ping Coal and Iron Nippon Steel Corporation Company 53-4, 70 234-7 Yawata Works 82 Fukiai Works 64, 86, 184 Hanyang Iron Works 43, 46, 52-3 Fukuyama Works 266 Hattori Prize 100 Futase coal mine 52 Hattori Susumu, Dr Ben Xi Hua Coal and Iron Company 72 General Mobilisation Bureau 180 Iron and Steel Institute of Germany Japan 98 First World War 70, 79 Yawata Works 44-5 Japanese imports 81, 90-1 Hayashi Senjuro 163, 164 Krupp 33 Hiraga Yoshimi 61 mergers 237 Hiranuma Kiichiro 168 Oshima Michitaro 36, 37, 41 Hirao Hachisaburo 170-1, 176, Oshima Takato 23 181-2 productivity I, 2, 3 Kawasaki Shipbuilding 184 Tripartite Pact 173 Hirohata Works 163, 180-1 Yawata Works 40-1, 42-5, 53, Hirohito, Emperor 133 61 Hiroshima Works 28 globalisation 262-72 Hirota Hisakazu 206-7 Go Seinosuke Hirota Koki 161 protectionism 112, 115 Hokkaido Coal and Shipping Toyo Iron Company 92 Company (HCSC) Godfrey, J.G.H. 22 Mitsui zaibatsu 94 Godo Takuo 163-4, 170 Nihon Seiko-sho 64-5 gold standard 133-4, 139 Wanishi Iron Works 67 Goto Shojiro 34-5 Hokkaido Iron Company 94 Great Britain Honda Kotara I 03 Armstrong 33, 64-5, 67, 94 Horubusu 25 First World War 70, 79 Hoshino Naoki 172 Japanese imports 81, 90-1, 173 House of Peers Kamaishi Works 25, 26, 31 national steel works 33 nationalisation 235-7 tariffs 139 productivity I, 2, 3 House of Representatives protectionism II 0 national steel works 33, 35 and Russia 51-2 tariffs 139 Slater, Samuel 20 Hyogo Works 63-4, 184 Stewarts and Lloyd Hyuga Hosai 232-3, 235 Company 68 Vickers Steel 62, 64-5, 67, 94 I-beams 255 greentields investment 6 lchimada Hisato 200 Gutenholfnungshiitte (GHH) 37, 43 lho Works 184 Ikeda Hayato 222-4 Haase, C. 39, 43 167 Hagiwara Kokichi 271 lmaizumi Kaichiro, Dr Hakuni Takeshi 114 Iron and Steel Institute of Hamaguchi Osachi 133-4, 136 Japan 98 Hamuro Yonosuke 61 Japan Industrial Club 112 Index 320320 Index

Nihon Kokan Kabushiki• Iron Nihon Kokan Kabushiki- Iron andand SteelStee l ControlContro l kaishakaisha 68-9,68-9 , 82-3,82-3 , 182-3182-3 Council 167-8 Yawata Works Council 167-8 Yawata Works 36,36 , 45,45 , 50,50 , 5656 Iron and Steel Council 19-20 Imperial Agricultural IronIron and Steel Council 19-20 Imperial Agricultural Iron andand SteelStee l IndustryIndustry PromotionPromotion Association 116 Law 84-5, 86, 121 ImperialAssociatio n 116 Law 84-5, 86, 121 Imperial RuleRule AssistanceAssistance Iron and Steel Institute of Japan Association 173 Iron and Steel Institute of Japan Association 173 (ISIJ)(ISIJ ) 98-10098-100 Imperial University of basic Imperial University of basic oxygenoxygen furnacefurnace 220220 TokyoTokyo 102-3102-3 Yawata Works 83 Netto, Yawata Works 83 Netto, ProfessorProfessor KurtKur t 2323 iron ore preparation Noro iron ore preparation Noro Kageyoshi,Kageyoshi , DrD r 3131 technology 104-6 Important Industries Association technology 104-6 Important Industries Association IsawaIsawa TakioTakio 147147 OrdinanceOrdinance 175175 Italy Important Industries Control Italy Important Industries Control pigpig ironiron qualityquality 3131 LawLaw 118,118 , 134-5134-5 Tripartite Pact 173 imports Tripartite Pact 173 imports ItaniItan i ShosukeShosuke 203-5203-5 1860s-1870s 22, 23 Ito Hirobumi 34 1880s-1890s1860s-1870s 22, 23 Ito Hirobumi 34 1880s-1890s 29-30,29-30 , 3838 Ito Yajiro 25-6 1910s 79, 81 Ito Yajiro 25-6 1910s 79, 81 IwakuraIwakura MissionMission 2222 1920s1920s 90-190-1 Iwakura Tomomi 22 1930s 158-9 Iwakura Tomomi 22 1930s 158-9 IwatoIwato BoomBoom 229229 1980s1980s 254254 lnayama Yoshihiro 155, 182 Japan Development Inayama Yoshihiro 155, 182 Japan Development BankBank 195,195 ,215 215 expansion plans 230 Japan Industrial Club Nipponexpansio n plans 230 Japan Industrial Club Nippon SteelStee l CorporationCorporation 234234 New Economic Structure 175 Income Doubling Plan 224 protectionismNew Economi c Structure 175 Income Doubling Plan 224 protectionism 110-12110-12 IndiaIndia Shiraishi Motojiro 84 Bengal Iron Company 69 JapanShiraish i Motojiro 84 Bengal Iron Company 69 Japan IronIron andand SteelStee l FederationFederation cartels 124, 125-7 (JISF) 177, 178, 213 Japanesecartels 124, 125-7 (JISF) 177, 178, 213 Japanese importsimports 81,81 ,91-2, 91-2 , 173173 basic oxygen furnace 220 tariffs 120, 138 Japanbasi c oxygen furnace 220 tariffs 120, 138 Japan IronIron andand SteelStee l RawRaw MaterialMateria l World Bank finance 14 Control World Bank finance 14 Control CorporationCorporation 171-2171-2 inductiveinductive leapleap 261261 Japan Iron and Steel Union 170 Industrial Bank of Japan 53 JapanJapan Iron and Steel Union 170 Industrial Bank of Japan 53 Japan IronIron OreOre TransportingTransporting innovations 7-11, 98-100, 219-22 Company innovations 7-11, 98-100, 219-22 Company 218218 EuropeEurope 2121 Japan Mining Society 24 Thomas Converter 183 JapanJapan SteelMinin g Society 24 Thomas Converter 183 Japan Steel CorporationCorporation 149-55,149-55 , Yawata Works 38-45 157-63 InoueYawat a Works 38-45 157-63 Inoue JunnosukeJunnosuke 133-4,133-4 , 139139 break-up 197-9 Inoue Kakujiro 64 break-up 197-9 Inoue Kakujiro 64 formationformation 135,135 , 140-8140-8 InoueInoue KaoruKaoru 9393 Japan Steel Materials Sales integrated producers 9 Japan Steel Materials Sales integrated producers 9 UnionUnion 167167 InterimInterim DirectiveDirective RegardingRegarding management 203, 204 Advance management 203, 204 Advance TransfersTransfers ofof JapaneseJapanese organisational development 49 Reparations 193 organisational development 49 Reparations 193 SecondSecond WorldWorld WarWa r 180-2;180-2 ; InukaiInuka i TsuyoshiTsuyosh i 137,137 , 138138 following years 192-3 Iron and Steel Business Law 164 Japan following years 192-3 Iron and Steel Business Law 164 Japan SteelStee l MaterialsMaterials SalesSales IronIron andand SteelStee l ControlContro l Union 166-7 Association 175-8, 187 Japan Union 166-7 Association 175-8, 187 Japan SteelStee l MaterialsMaterials UnionUnion 167-8167-8 Index 321

Jinmu boom 216 Kenseikai Party 121 Jinmu, Emperor 216 Keynes, John Maynard 137 JK Activity 245-52 Kimitsu Works Joint Purchase Association of output 257 Steelmakers (JPAS) 126-7 quality control circle movement 243-52 Kabayama 33 technology 258 Kaiseigakko 102 Kimura Kusuyata 115-16 Kamaishi Mining Company Kishi Nobosuke 162, 170, 178, 182 Limited 94 rationalisation 118 Kamaishi Works 66-7 Temporary Industrial development 22, 24-5 Rationalisation Bureau 134 failure 25-31 Kishimoto Nail Works 95 First World War 81, 87 Kishimoto Shoten 95 international comparison l Kishimoto Trading House 69 Japan Steel Corporation 149-50 Kobana Fuyukichi 36 Mitsui merger 92, 93-4 Kobayashi Seiichiro 62 subsidisation 123 Kobayashi Steel Works 62 and Yawata Works 39, 47-8 Kobe Steel 62-3 Kamiya Haruki 269 First World War 87 Kanao Minoru 268 growth 254 Kaneko Kentaro 35 Japan Steel Corporation 149 Kaneko Naokichi 63 management 204, 205, 206 Kanto earthquake 114, 129 merger 208 Kanto Steel Material Sales Second World War 185-6 Association 130 Kobiyama Naoto 176 Karafuto Industry 135 Kobusho Kogakuryo I 02 Kasuga Hiromu 205 Koga Keisuke 256 Kataoka Naoatsu 117, 119 Kokura Steel 86 Kataoka Naoteru 61 Japan Steel Corporation 149, 153 Kawada Shige 206-7 merger 208 Kawakami Kin'ichi 61 Komura Koroku, Dr Kawasaki Heavy Industries (KHI) Iron and Steel Institute of break-up 198 Japan 98 designated price system 228 Kamaishi Works 31, 66; Mitsui management 203-5 merger 94 Second World War 184-5 Komura Prize I 00 Kawasaki Hyogo Works 63-4, 87 Konoe Fumimaro, Prince Kawasaki Shipbuilding 63-4 first cabinet 165, 167, 168 Fukiai Works 86 second cabinet 172-4, 178 Japan Steel Corporation 149 Korea Kawasaki Shozo 63-4 annexation 52 Kawasaki Steel 198-200 Kenjiho Works 54, 73 Chiba Works 106, 208-11 military tension 32 Mazushima Works 224 Pohan Steel Corporation 263 Nishiyama Yataro 207-11 Second World War 181 Keihin Works 266 steel quality 254 Kenjiho Works 54, 73, 95 Tonghak revolt 35 Japan Steel Corporation 150 Yawata Works 54, 55 322 Index

Korean War 197 Miki Takashi 155, 181 Kosugi Tatsuzo 62 Japan Steel Corporation 182, Krupp 33 205-7 KS steel 103 Yawata Steel Corporation 198 Kuji Works 184 military expansion 51-4 Kukioka mills 107-8, 161 minimills 254-6 Kure Navy Arsenal 38 minimum efficiency scale Kobe Steel 63 (MES) 226 Nihon Seiko-sho 65 Ministry of Agriculture and Sumitomo Copper Factory 60 Commerce (MAC) Kuroda Coke Oven 106 break-up 116 Kuroda lsakuma 63 Commitee for Research on Steel Kuroda Yasuzo 106 Production 33-4 Kuwayama Teijiro 180-l Council of Iron and Steel Kwantung Army 133 Production 35 Kwantung Peninsula 51, 52 economic and military demands 38 League of Nations, Lytton Investigation Committee of the Iron and Steel Business Commission 138 83 Love, Howard M. 269, 270-1 Iron and Steel Institute of Japan 100 LOhrmann, F.W. 39 115, 116 Yawata Works 43, 46, 61 Machinaga Saburo 206-7 Ministry of Agriculture and Makita Tamaki 149 Forestry 116 Malaya 55 Ministry of Commerce and Industry management (MCI) economic purge 200-7 creation 116-17 Japan Steel Corporation 147-8, Important Industries Control 153-4 Law 134-5 Manchuria Japan Steel Corporation 141, Chan Tso Lin assassination 133 142-4, 150-5, 157-62 invasion by Japan 136-7, 138 price controls 195 iron ore preparation Reconstruction Finance technology 104-5 Bank 195 Russian ambitions 51 Second World War 177-82, see also South Manchurian 186-8 Railroad Company Yawata Works 129 Mannesmann 's seamless Ministry of Finance (MOF) 171 method 68 Ministry of Industry 22, 24 market price 227-8, 229 Ministry of International Trade and Industry (MITI) deflation policy 27 Dodge Line 196 Hyogo Shipbuilding Yard 63-4 First Rationalisation national steel works 33 Programme 212-17 Matsumoto Tadao 146 industrial growth 11-14 Matsuoka Yosuke 172 intervention 229-30 Meiji Emperor 34, 35 Nippon Steel Corporation 234, Miike Coal 93 235 Index 323

open sales system 229 Japan Steel Corporation 142, Second Rationalisation 146-7, 148, 181 Programme 218-19 Japan Steel Material Sales Steel Supply and Demand Union 166-7 Stabilisation Law 228 Nakajima Kumakichi 138, 140 'Sumitomo Rebellion' 232-3 Japan Steel Corporation 143-4, technological innovations 220-1 145, 147-8 Ministry of Posts and Nakamachi Works 163 Communications 62 Nakamatsu Shingyo 181 Minseito Party 133 Nakamura Yujiro 40, 44 Mito domain 19, 21 Nakaosaka Works 28 Mitsubishi Heavy Industries 135 Nakayama Steel 153 Mitsubishi Steel Corporation Nanbu domain 21 Japan Steel Corporation 150 National General Mobilization Kenjiho Works 54, 73, 95 Law 167, 175 Mitsubishi zaibatsu 91 National Intergroup, Inc. Japan Steel Corporation 150 (Nil) 269-71 Kenjiho Works 95 National Railway Bureau protectionism 112, 116 (NRB) 59-65 subsidisation 123 National Steel Corporation 266-71 Mitsui Bank Navy, Japanese 33 Kamaishi Works 66-7 Kure Navy Arsenal 38 speculation 139 Russo-Japanese War 52 Mitsui Bussan 75-7 steel producers 59-65 Mitsui-gumi 76 Netto, Professor Kurt 23 Mitsui Mining Corporation Neuhiiser, W. 39 Japan Steel Corporation 149-50 New Economic Program Kamaishi affiliation 93-4 (USA) 240 Wanishi Iron Works 67 New Economic Structure Mitsui zaibatsu 91 (Japan) 173-4 distribution system 76 New Export Plan 213 Japan Steel Corporation 149-50 New Political Structure 173, 175 mergers 92, 93, 94 New Structure Movement 173 Oji Paper 135 Nihon Chutetsu 36 protectionism 112, 116 Nihon Kokan Kabushiki-kaisha Mizushima Works 224 (NKK) 68-9 Munitions Companies Law 187 Asano Soichiro 96 Munitions Ministry 180 First World War 79-81, 87; Muto Sanji 121-2 following years 90, 92 globalisation 263-72 Nagano Shigeo ISS, 182, 190 innovation 220 Fuji Steel Corporation 198 Japan Steel Corporation 145-6, Japan Steel Corporation 206-7 149 Nippon Steel Corporation 234 management 203, 204, 206-7 Nagasaki 24 Mitsui merger 94 Nakai Reisaku profits 151 consolidation 140 Second World War 182-3 independent accounting Nihon Seiko-sho 64-5, 87 system 118-19 Nippon Copper Inc. 60 324 Index

Nippon Steel Casting Works 60-1 organisation of firms Nippon Steel Corporation 234-7 capability 13 globalisation 263, 268 Japan Steel Corporation 147-8 1-Beam Wars 254-6 Yawata Works 46-51 Kimitsu Works 243-52, 257 Organization of Petroleum market share 238 Exporting Countries rationalisation 256-8 (OPEC) 240 size 32 Osaka Army Arsenal 60 technology 258-62 Osaka Copper Inc. 60 Nishinomiya Works 184 Osaka Mint Bureau 60 Nishiyama Yataro 184-5, 190, Osaka Steel 86, 149 198-200, 206-11 Oshima Michitaro 19 competitive model 226 Ben Xi Hua Coal and Iron Nixon, Richard 240 Company 72 Noda's demand curve 161 Yawata Works, 24, 36-7, 40-3, Noda Tsuruo 161 52 non-integrated producers 9 Oshima Steel 96 Noro Kageyoshi, Dr Oshima Takato 18-24 Iron and Steel Institute of overborrowing 209 Japan 98 oversupply 231 Kamaishi Works 31 Oxygen Converter Gas Recovery Nihon Chutetsu 36 System 251-2 proposal, national steel works 33 Pacific War 178 Yamata Works 35, 37, 41, 44-5 Pauley, Edwin W. 191-2 Perry, Commodore Matthew 21 Ogawa Kyotaro 161-3 Philippines 55 Ogishima complex 266-8 Pig Iron Cooperative Ohashi ore deposit 21 Association 124-6 oil crisis 240-2 Pig Iron Joint Sales Oji Paper 135 Company 152-3 Okawa Heisaburo 96 Pingxiang Coal Mining 53 Okubo Toshimichi 23 Pohan Steel Corporation 263 Okura-gumi 69, 72, 76 Portsmouth Treaty 52 Okura Kihachiro 68-9 Price Control Ordinance 170 Okura zaibatsu 68, 95-6, 91 principal public offices 201 distribution system 15-1 priority production system 193 government promotion 84 production process 8-9 O'Leary, Paul M. 197 productivity 1-5 Omori Hisanori 209 1860s-1870s 22, 23 open hearth furnaces (OHFs) 9 1880s-1890s 29 flexibility 92-3 1910s 85-6 Nishiyama Yataro 184-5 1920s 88-9, 93 processes 58 1930s 156-60 Yawata Works 45 promotion of industry, open sales system 229, 231 governmental 78-88 Opposition Party, and national steel protectionism I 09-17 works 33, 34, 35 P'u-yi 138 ordinary public offices 201 public service 201 Index 325 quality control circle (QCC) kaisha 69, 84 movement 243-53 Showa Depression 132-6, 174 cartels 125, 130 railways 22, 89 Showa-kai 164 rationalisation 118, 132-6 Showa Steel 163-4, 211 First Programme 213-15 silicon wafer manufacturing 259 Japan Industrial Club 112 Sino-Japanese VVar 35 Nippon Steel Corporation 257-8 Slater, Samuel 20 Second Programme 216-19 Smithsonian Agreement 240 Third Programme 224 South Manchurian Railroad Reconstruction Finance Bank 195 Company (SMRC) 52 reverbatory furnaces 19 Anshan VVorks 54, 72, 105, rolling process, oil re-use 250-3 122, 124 Roosevelt, Theodore 52 Japan Steel Corporation 152 Russia 51-2 management 147 Russo-Japanese War 52, 60, 61 Showa Steel 164 Ryu Shintaro 174-5 Special Accounting Law of the Yawata VVorks 118 Sabashi Shigeru 233 spin-off engineers 74 Sado Gold Mines 24 Steel Association 129 Sado Mining Bureau 24 Steel Supply and Demand Saga domain 19 Stabilization Law 228 Saito Makoto, Admiral 138, 140 Stewarts and Lloyd Company 68 Sakamoto Yahachi 28 Strike Mission 194 sales price 227-8 subsidies 120-3, 171, 178-9 Sanwa Bank 135 Sumitomo Bank 60 Sanyo Iron Works 95 Sumitomo Copper Factory 60 Satsuma domain 19 Sumitomo Copper Works 60-2, Schumelzer, H. 43 87, 95 Scrap Investigation Mission 217 Sumitomo Electric Industries 60 Scrap Joint Purchase Sumitomo Electric VVire 60 Association 167 Sumitomo Kichizaemon 103 Second I-Beam War 255-6 Sumitomo Metal Industries Second Rationalisation establishment 62, 135 Programme 216-19 management 204, 205, 206 Seitsu Works 181 merger 208 Seiyukai Party 132, 137 origins 60 self-sufficiency 46, 47-8, 59, profitability 253 130-1, 157-9 'Rebellion' 232-4 Sheng Xuanhuai 52-4, 70 Second VVorld War 185-6 Shibusawa Eiichi 92 Sumitomo Steel Casting Shio Takafusa 116 Works 61-2 Shimazu Nariakira 19 First VVorld VVar 87, 95 Shimonoseiki Treaty 35 KS steel 103 Shiraishi Motojiro Sumitomo zaibatsu 95, 97 Asano Soichiro 96 super high magnesium Japan Steel Corporation 145-6, process 249 149 Supreme Commander for the Allied Nihon Kokan Kabushiki- Powers (SCAP) 191-3, 195-201 326 Index

Suzuki Shoten 62-3, 132 Tojo Hideki, General 161, 172, 178 Tokai Kogyo 96, 149 Ta Yeh Mine 82 Tokugawa government 19 Takahashi Korekiyo 115 Tokyo Kozai Company 95 economic policy 137-40, 157 Tokyo Steel 254-6 Japan Steel Corporation 150-1 Tonghak revolt 35 Ministry of Agriculture and Toppe, Gustav 43, 52 Commerce 116 Toyo Iron Company 86 Takayama Jintaro 36, 45 Japan Steel Corporation 149 Takeda Yutaka 257, 262 protectionism 112 Tamiya Kaemon 63, 205 reorganisation 92 Tanaka Chobei 26, 27, 28-31, Toyoda Teijiro 182, 203 93-4 training 100-3 Tanaka Giichi 132-3 Treaty of Portsmouth 52 Tanaka Kakuei 240 Treaty of Shimonoseki 35 tariffs 109-17, 120-1, 138-40 Tripartite Pact 173 Tatara method 1, 19 Tsurumi Steel and Tawara Kuniichi, Dr 98, 103 Shipbuilding 183 Tawara Prize 100 Twenty-one Demands 70, 82 Tayeh Mine 52, 53, 54 taxation Umene Tsunesaburo 105 Iron and Steel Business Promotion Law 84 United States of America rationalisation 215 Cold War 194 technological innovations 7-11, economies of scale 4-7 98-100, 219-22 gold standard 133 Europe 21 Japanese cartelisation 27 Thomas Converter 183 Japanese globalisation 263-71 Yawata Works 38-45 Japanese imports 79, 81, 90-1 Temporary Committee to multi-divisional Investigate Iron and organisations 148 Steelmaking Oshima Michitaro 37 Kamaishi Works 26 productivity 1, 2-4 national steel works 34 Second World War 172, 173 protectionism 115-16 Slater, Samuel 20 Yawata Works 50-1, 83-4 technological innovations 10, 14 Temporary Industrial Council 134 yen exchange rate 240 Temporary Industrial United States Steel Corporation 2 24, 32 Rationalisation Bureau 134-5 United Steelworkers union 269, Temporary Investigation Committee on Fiscal Policy and the 270-1 Economy 112-13 US-Japan Ship and Steel Exchange Terano Seiichi 98 Pact 79 Tetsu to Hagane 98-9 users' certification system 168 Third Rationalisation USIMINAS Corporation 262-3 Programme 224 Utoro Shingo 185 Thomas, Sidney 183 Thomas Converter 183 Vickers Steel 62, 64-5, 67, 94 Tohoku University 103 voluntary self-regulation 230-3 Index 327

Nada Tsunashiro 38 following years 89, 90-2 Yamata Works 43, 44, 53 Hamuro Yonosuke 61 Wakatsuki Reijiro 136-7, 139 Iron and Steel Institute of Wanishi Iron Works 64, 65, 67 Japan 99-100 First World War 87 large blast furnaces 107-8 Mitsui merger 92, 94 military expansion 51-4 subsidisation 123 Nippon Steel Corporation 234-7 Washington Disarmament organisational development Pact 88-9, 96 46-51 Watanabe Masato 203 Oshima Michitaro 24 Watanabe Wataru 40 and private companies 73-5 Watanabe Yoshisuke 182, 203, 207 protectionism Ill, 112, 114-17 World Bank loans 226, 227 significance and limitations Indian steel industry 14 54-6 Kawasaki Steel 209 Steel Association 129 technological development Yamada Jun'an 25 38-45 Yamada Kozo 270 Yamazaki Kyutaro 61 Yamanouchi Teiun 36, 43 yen bloc 165 Yamaoka Takeshi 107-8, 211 Yokohama Specie Bank 53, 54 Yamazaki Kyutaro 61 Yokoyama Kyutaro 31, 66 Yasuda zaibatsu 96, 97 Yonai Mitsumasa, Admiral 168 Yasuda Zenjiro 96 Yoshino Shinji 162, 165 Yasunaga Yoshiaki 36 Ministry of Agriculture and Yawata Steel Corporation 198 Commerce 116, 118 Yawata Works Temporary Industrial Bar Segments Agreement 130 Rationalisation Bureau 134 cartelisation 118-19 Yuri Kimimasa 28 consolidation 140-5 designated price system 227-8 zaibatsu education and training 101-2 examples 27-8 establishment 2, 32, 35-8 mergers and affiliations 93-7 expansion 58-9 opposition 139, 193-4, 200 First World War 79, 81-7; subsidies 121, 122