Chinese Debates on Industrial Policy and the Influence of Japan, 1900–40

This paper examines debates concerning Chinese industrial policy in the first four decades of the twentieth century. Although industrial policy is largely associated with state-led economic strategies in postwar Japan and the Tiger Economies, recent historical works have identified the importance of a set of rural and bottom-up government institutions aimed at providing overseas market and technological information to traditional industries, to late nineteenth-century Japan’s success as an exporting power to Asia. As a result of her defeat to Japan in 1894-95, Chinese policymakers and local elites in coastal provinces paid acute attention to developments in Japan. Following Chinese attendance of the Fifth National Industrial Exhibition in Osaka in 1903, Yuan Shikai, the powerful viceroy of Zhili province, launched an ambitious industrial development program from the treaty port of Tianjin, which nonetheless aimed to revitalize traditional industries in rural areas. Despite the “Japanese” origins of these policies, their lack of explicit ideological or political character and the relevance of the program to labor-intensive activities meant that they continued to inform Chinese thinking in the interwar period, in spite of the absence of a strong Chinese state and the deterioration of Sino-Japanese relations after the mid-1910s. By the 1930s these industrial policies, which took shape in preceding decades, began to have a real impact on the Chinese economy contributing to intense intra-regional competition with Japan. This paper seeks to rethink the role of the Chinese “state” in economic development in a period when historians have regarded it as being largely dysfunctional if not non-existent, and to affirm the importance of intra-Asian connections in China’s response to the modern capitalist economy. It also argues that from the angle of political economy, changes in rural manufacturing in the Chinese interior were more significant than Western-derived developments in the coastal treaty ports.