This chapter explores labour-intensive industrialization in modern Japan by focusing on the development of small-scale industries in both rural and urban areas. Since the 1970s, studies of the history of indigenous industries have revealed that Japan’s modern economic growth included the development of various forms of industrial organization other than the factory system.1 A book written by Takafusa Nakamura pioneered this stream of studies, proposing the notion of ‘balanced growth’ of modern and traditional industries in Japan before the First World War (Nakamura 1971/1983). This was a reinterpretation of the ‘dual structure’ which characterized the Japanese economy and had been regarded until then as a peculiar sign of ‘backwardness’. Under the influence of this histor­ iography, subsequent studies have tended to consider the existence of various form of industrial organization, albeit implicitly, as a peculiar feature of Japan’s economic development. On the other hand, since the 1980s, it has been widely recognized that forms of production besides the modern factory can be found in the industrial history of various areas and countries, albeit to differing extents. Inspired by the concept of ‘flexible specialization’, proposed in the seminal paper by Sabel and Zeitlin (1985), several other works have focused on the role of small-scale industries in the economic and business history of Europe and North America. In addition to the cases from the Continental Europe (Herrigel 1996; Sabel and Zeitlin 1997), Berg (1994) insisted that various forms of production had co-existed in England throughout the eighteenth century. Hudson’s 2004 paper extended this view to the latter half of the nineteenth century. As far as North America is concerned, Scranton (1997) emphasized the vitality of non-mass production systems in the United States at the beginning of the twentieth century. Referring to these works, it is now clear that the mere existence of diversity in the forms of production is not sufficient to make the structure of a national economy distinctive. Is it pos­ sible, even so, that a focus on the development of small-scale industries can help us to identify the specific characteristics of Japan’s industrialization? The argument of ‘labour-intensive industrialization’ offers an important clue to answering this question. In the ‘flexible specialization’ thesis, the concept of ‘craft’ is important in accounting for the ability of the workforce to cope flexibly with the shifting pattern of demands requiring high quality products within the

Western countries. On the other hand, the quality and price range of goods manu factured by small-scale industries was generally much wider in Japan than in the West (Tanimoto 2006). The essential attributes of the labour force of Japan’s small-scale industries, therefore, may have been much broader and more diverse than the concept of ‘craft’, which has usually been recognized as the basis for producing high-quality products. As the phrase ‘labour-intensity’ can be associated with one or more of certain attributes of the workforce, such as ‘industriousness’, ‘skilled’ or ‘low wage’, this concept appears to be more applicable than ‘craft’ for describing the nature of the labour force that constituted the competitive edge of the small-scale industries of modern Japan. This is the main reason why we relate the argument of ‘labour-intensive industrialization’ to the development of the small-scale industries. Several studies have attempted to account for Japan’s industrialization by relating it to the concept of ‘labour-intensive industrialization’. Heita Kawakatsu applied Akira Hayami’s notion of ‘industrious revolution’ – conceptualized from the changing behaviour of peasant households in the seventeenth century – to the debate about the nature of Japan’s industrialization (Hayami 1979/2001, Kawakatsu 1994). Kenneth Pomeranz also rests the foundation of Japan’s industrialization on family farming as it developed during the Tokugawa period (2000, 2001). The peasant economy also played a significant role in Osamu Saito’s (2005) model of ‘two kinds of pre-modern, Smithian, economic growth’, which attempted to distinguish the trajectories of Europe (particularly England) and Japan. Thus, an emphasis upon the role of the peasant economy is a common feature of studies relating to ‘labour-intensive industrialization’ in the context of Japan. We completely agree with these studies with regard to the role of the peasant economy and family farming in shaping the behaviour of the labour supply in Japan. The plural employment strategy of the peasant household will be the central issue of the following section that discusses the cotton weaving industry in modern Japan. However, by its nature industrialization has been accompanied by urbanization. Can we extend to the cities the notion of ‘labour-intensive industrialization’, based as it originally was, on the agrarian setting? From this perspective we notice a missing link in the available literature. The studies mentioned above focused mainly on the pre-modern period and did not tackle the industrialization process itself. Recent work by Kaoru Sugihara is important in this context. He formulated the argument of ‘labour-intensive industrialization’ and used it to characterize East Asian development, covering the period from the Tokugawa era to after the Second World War along with a discussion of nonagrarian sources of industrialization (Sugihara 2003). However, thus far, he has not succeeded in sufficiently specifying and documenting this missing link between pre-industrial agrarian society and industrialization. The link, which was pointed out in his 2003 paper, was limited to the figure of the affluent and relatively highly qualified labourer who emerged from the peasant society. How did people maintain their ‘agrarian’ nature in non­ agrarian settings? Empirical studies on industrialization itself are now required.