187 Hi iB AE LAF RMRLE S125, 187-202, 2002 Tokugawa Law : How it Contributed to the Economic Success of Japan Gregory M. Bornmann and Carl M. Bommann Abstract Important aspects of Tokugawa law resulted in the development of trade and commerce in Japan. There is strong evidence that the institutional foundations for the political economy of the Edo Period can be found in the overall evolving legal structure of the Tokugawa Shogunate. In order to support such a conclusion it is necessary to explore the legal foundations for the political economy of the Edo Period and examine how Tokugawa law ultimately contributed to the rise of the economic success of Japan, Key words : Tokugawa Law, Japanese Economic Development INTRODUCTION Many reasons have been attributed to the pre- modern or early modem preparation for Japan's modernization afforded by Tokugawa Japan during the Edo Period. Scholars and writers, both Japanese and Western from various disciplines, have focused on certain specific matters. Among these have been: the rapid growth of urbanization,'! diversification (e.g., cotton and sweet potatoes) and technological advancement (farm implements and the use of fertilizers) in agriculture?! demographic movements from village to city and then from city to rural areas,*) adoption of by-employments by village societies (silk industry and crafts),*’ the division and distine- tion between the military ruling elite class (Sa- murai) and the subservient but essential commoner class (peasant-farmers),°’ the land tax system (ko- kudaka),*? the nationwide education system,”) the alternative attendance system (sankinkokai),®) and the rise of the merchant classes (just above the artisan/craftsmen and beggars).”’ All of these fac- tors can be accumulated into one principal phenom- enon : Tokugawa law, the edicts of the Tokugawa Shogunate for over 250 years during the seventh, eighteenth and nineteenth centuries (cir.1603-1868). Although many volumes have been written by Western scholars on Tokugawa law, have been translated into English, and have recited various aspects of the legal structure during the Edo Period , primarily be John Henry Wigmore, John Carey Hall and Dan Fenno Henderson,!® among others, there appears to have been no one who has undertaken any study of the relationship between Tokugawa law and Tokugawa trade and commerce or how the former influenced the rise of the merchant class, the demise of the Samurai class (including the Sho- gunate itself) and the ultimate economic success of Japan. There is strong evidence that the taproot of the institutional foundations for the political econo- my of the Edo Period can be found in the overall evolving legal structure of the Tokugawa Sho- gunate. In order to support such a conclusion it is GMA EL SE TF 716-8508 ALLA REST (FLATS RAD a=7—-Y ay eH Department of Business Communication, School of Sociology, KIBI International University 8, Igamachi, Takahashi, Okayama , Japan (716-8508)188 Tokugawa Law : How it Contributed to the Economic Success of Japan necessary to explore the egal foundations for the political economy of the Edo Period and examine how Tokugawa law ultimately contributed to the rise of the economic success of Japan. During the Edo Period there existed essentially a four-class socioeconomic system consisting of the Samurai, the peasant-farmers, the merchants and the artisan/ craftsmen in that hierarchical order.!") Two other very minor groups that contributed virtually nothing to Japan's economy during the Edo Period were the Emperor and his Royal Court (throughout the history of Japan, The Emperor reigned but did not rule) and the "others", the outcasts, beggars, etc The Samurai, including the Shogun and his retain- ers, constituted about 10-12 percent of the total population throughout most of the Edo Period. The peasant-farmers represented about 80-82 percent and the merchants and artisan/ craftsmen only 5-6 percent.!2) An examination of Tokugawa law indicates that the combined effect of the laws of the Shogunate (or lack thereof) favored the merchant class (as well as the artisans / craftsmen) over the Samurai class, economically and socially and to a certain extent politically. It may be argued that Japan arose from a feudal society and because of Tokugawa law, developed into a "centralized" commercial econom- ic society. A general understanding of a nation’s legal system and how the government is organized and administered is extremely helpful, if not essential, to any study and analysis of its economic institutions and how they operate. Central to the understanding of society and its political, social, and economic characteristics is the role of law, its development, change, and integration with other aspects of social life. * * * A study of law thus represents one means, and an extremely important means, by which a culture can be understood. It is concemed with the political society of the nation, the regulation of power and its legitimacy and transmission... To be sure, law is not sufficient for a comprehensive analysis an important beginning can be made through understanding law, broadly interpreted, which will contribute to and provide a focus for further research and study. THE RELEVENT TOKUGAWA LAW Soon after the Tokugawa family and its sup- porters eliminated the Toyotomi family and its supporters at the battle of Osaka Castle in 1615, the Tokugawa Shogunate proceeded to promulgate the laws for the Royal Court and the Court Nobles (kuge hoshiki) governing the functions and behavior of the Emperor and the Court, which had the effect of stripping the Emperor of any administrative power of function, The Shogunate then turned its attention to governing the daimyo and other Sa- murai with the Laws for the daily lives of the Shogunate and Samurai class, as well as certain luxuries. The Bakuhan system inevitably created a "mini" international competitive market system. The castletowns, originally designed and construct- ed as military fortresses for the Samurai class, became citadels of trade and commerce for the merchants (and artisans/craftsmen) and those former Samurai (the reluctant ronin) and the peasant- farmers that joined their ranks. The growth of Edo in turn contributed to the accelerated progressive development of Osaka/Kyoto as the primary center for the collection, storage and distribution of prod- ucts from the domains for shipment to Edo and the castletowns. This arrangement evolved because of the strategic location of Osaka as a seaport on the Inland Sea. Osaka is also connected to Kyoto by river and thereby Kyoto also developed in impor- tance as a commercial center. Sea travel was themost efficient and economical means of long dis- tance inter-domain transportation because of Ja- pan’s predominantly mountainous terrain." The ultimate result was that while Edo and the cast- letowns were growing as consumer centers of Tokugawa Japan, the Osaka/Kyoto area grew rapid- ly as the leading supply and distribution center. Essentially, the merchants and artisans/craftsmen provided the blood stream that gave life to the body of the Shogunate and Samurai in Edo and the castletowns, Trade relations between Osaka/Kyoto and Edo and the castletowns along and on the periphery of the Tokaido road, on the one hand, and between Osaka/Kyoto and the domains (han), on the other, brought about the need for and consequent rapid development of a more efficient and economical system of transportation and communication by land and by sea. The responsibility for providing the necessary modes and mechanisms to facilitate the dynamic-expansion of trade and commerce and to provide the essential market and monetary network, of course, fell upon the shoulders of the merchants and artisans/craftsmen because they were equipped to accomplish such purposes. It was beneath the dignity of the Samurai to be connected in any way with matters related to trade or commerce.!*’ The reluctance of the Samurai to engage in commercial matters resulted in great benefits to both the merchants and artisans/craftsm- en, as well as the peasant-farmers to the decided detriment of themselves. Both the merchants and, to a lesser extent, the peasant-farmers eventually passed the Samurai class by substantial proportions in wealth and economic power. The merchants were too adroit to engage in thwarting the Bakufu system. It was to their advantage to work within the system and use it to engage in mercantile and money lending activities. And that is what they did. The artisans/craftsmen also received substantial econom- Gregory M. Bornmann and Carl M. Bommann 189 ic benefits from the concomitant circumstances of the increased building and construction activities in Edo, the castletowns and other major cities, as well as construction of and along the Tokaido road other routes of travel by land and by sea. The merchants prevailed over the Samurai because the transforma- tion from an agricultural/rice economy to a mer- cantile/money economy! during the Edo Period was brought about and natured by Tokugawa law, however inadvertent and unintended. The increasing poverty of the Samurai and re- sulting substantial increase in Samurai debts to the merchants and the wealthy farmers, from the lowest retainer up to the Military Houses (buke shohatto), promulgated by Hidetada, the second Tokugawa Shogun in 1616.” The original buke shohatto was merely a co- dification of customary laws, which supplemented them and did not replace them2® In order to emphasize the importance of the buke shohatto, it was always reaffirmed and amended upon the accession of a new Shogun (e.g., 1635, 1663m 1683, etc.)2 It was after Tematsu became the third Shogun (1623-1651) that the buke shohatto was amended to codify in specific terms the traditional practice of the alternative attendance system (sankin kotai) Each daimyo was required to alternate years of residence in Edo and in his own domain (han), and his wife and family were required to remain in Edo as “hostages” when he returned to his domain (han)? In addition to the written laws (codes) pro- mulgated by the Shogunate, Tokugawa law consist- ed of edicts of the Shogun and customary law and practices. Despite the written laws promulgated by the Tokugawa Shogunate, the daily lives of the lower class peasant-farmers, artisans/ craftsmen and the merchants continued on little, if at all, effected. The codes and edicts were not directed toward any of190 Tokugawa Law : How it Contributed to the Economic Success of Japan those classes of persons. The kuge_hoshiki was directed to and effected only the Emperor and the Imperial Court Nobles, the buke shohatto was directed to and effected only the Warrior Classes (the daimyo and other Samurai) and the kostsu was directed to and effected only the gentry (hatamoto) in the castletowns. As for the Code of 100 Articles (o-sasame-gaki_hyakkajo), it was essentially a co- mpilation of customary practices directed to Bakufu officials for their guidance in administration, was not made public, and therefore did not affect the everyday lives of the peasant-farmers, artisans/ craftsmen or merchants.2!’ Generally, commerce in Tokugawa Japan was conducted by oral agreements on the basis of mutual trust and confidence between the parties. Because of the trust factor, neither buyer nor seller dared default on an oral contract. If he did, when word got out into the market place, the breaching party would be ostracized.’ In summary, Tokugawa law consisted of codes, sumptuary and customary laws continued by the Tokugawa Shogunate during the Edo Period, Sankin kotai, the alternative attendance system, undoubted- ly had the singularly greatest impact on the political economy and the development of a centralized feudal mercantile system. Other aspects of To- kugawa law are interrelated and interacted with the kin Kotai system and each other to form a body of Tokugawa law relating to matters of trade and commerce and provided a basis for the merchants of, trade and commerce and provided a basis for the merchants of Tokugawa Japan to rise in wealth and economic success and prepare Japan itself for economic success in the nineteenth century and there after Merchants and arti s/craftsmen , although os- tensibly in a lower class than peasant-farmers in the hierarchy of the class society of Tokugawa Japan, actually had the upper-hand in matters of trade, and commerce, and wealth, especially in dealing with the Samurai class, who disdained anything connect- ed with trade or commerce. Although characterized by many historians as the dregs of Tokugawa society, the merchants, as became most evident in the twentieth century, proved to be the key to Japan's dynamic economic performance in the international marketplace. Akio Morita of Sony recognized in the 1950s that most Japanese compa- nies doing business in the United States relied on the experienced Japanese trading companies?) ‘The major aspects of Tokugawa law which were most predominant in their impact on providing the merchant with foundations for economic wealth, power and dominance during the Edo Period were: (1)buke_shohatto, which institutionalized sankin kotai the alternative attendance system”) cokudaka, the land tax system?’ and (3)Samurai_ fixed rice stipends.2”” Other important elements in the legal structure included: disenfeoffment of Samurai land, adoption of the culvitator (nago) system and relocation of the Samurai into the castletowns and Edo®”’ and aboli- tion of control points (border guards).2* All of the above, together with their inter- relating imp: ‘t upon and interaction with non-legal factors, such urbanization, agricultural growth, and population control, are also important factors. In addition there were two other significant histori- cal developments concerning Tokugawa law which require consideration: "The Three Great Reforms” and "The Tanuma Era”. The great promulgators of Tokugawa law were leyasu, Hidetada and Iemitsu (the first, second and third Shoguns-father, son, and grandson), among whom Ieyasu was undoubtedly the strongest during the founding of the Tokugawa Shogunate. Next in legislative distinction was Iemitsu because of his foreign seclusion and anti-Christian edicts of 1635 The most active period of legislation, however,occurred during the term of the eighth Shogun, Yoshimune (1716-1745) Ironically, the other two most prominent Legislators of Tokugawa Japan were not Shoguns, but served in the capacity of Senior Councilor of Regents to minor or mentally incompetent Shoguns. Tanuma Okitsugu (1719- 1788), served as Senior Councilor to Ieharu, tenth Shogun (1760-1786), at the time a minor, and Matsudaira Sadanoba( 1758-1829), served as Regent to Ienari, eleventh Shogun(1787-1837), another infant(and also incompetent). It is evident that the Edo Period was not entirely filled with leadership from the Tokugawa house. SANKIN KOTAI Although the sankin kotai system was designed to secure the permanent continuity of the Tokugawa hegemony by keeping a close eye on the warrior Samurai class and thereby prevent any rebellious action in any of the domains (han), especially the han of the outer lords (daimyo). The unintended and unanticipated economic effects of sankin kotai were disastrous for that purpose, but eventually proved to be highly beneficial for the long-term future of Japan. Sankin kotai required that daimyo alternate years of residence in Edo and in his own domain, and his wife and family were required to remain in Edo as “hostages” during his stay in his han. The extraordinary expense exacted upon daimyo, his han and Samurai retainers, of maintaining two resi- dences, one in Edo and another in his han, his own domain, together with the costly transportation to and from the daimyo’s han and Edo with a large and impressive retinue, wore more and more heavily on the financial capability of each attending daimyo and his han, and hence kept him militarily weak.” On the other hand, operation of the sankin_kotai system required the development of a nationwide transportation and communication system, the growth of large commercial centers, such as Osa- Gregory M. Bornmann and Carl M. Bommann 191 ka/Kyoto and others along the Tokaido way be- tween Osaka and Edo, and a network of trade and monetary transactions. This combination of circum- stances eventually provided the merchants (and artisans/craftsmen) a foothold into the gap between the Samurai rulers and the peasant-farmers. The military elite, the daimyo and their Samurai retain- ers, as well as the Bakufu itself, needed goods and services, the peasant-farmers had to be paid, and the merchants (and artisans/crafismen) provided the means for trade and commerce, transportation and communication, creating the necessity for a money economy by-passing and surpassing the rice based taxing economy. Sankin kotai coupled with kokudaka, the land tax system, and the Samurai fixed rice stipends, eventu- ally exhausted the Samurai class financially. KOKUDAKA Following completion of the famous c: \stral land survey of all of the nation’s 250-260 provinces (han) during 1584-1598 (approximately 15 years), Toyotomi Hideyoshi instituted the kokudaka land tax and holding system which was carried over into the Edo Period and continued by the Tokugowa Shogunate essentially unchanged for over 250 years. The tax base was the estimated value of koku (about five bushels ) of rice for a specified area of land as indicated by the land surveys and experience factors. The land surveys were reviewed and updat- ed occasionally, though not frequently enough, during the Edo Period. Land measurement remained little changed after the end of the seventeenth century, Inherent weaknesses in the system were the inability to make accurate measurements, calculate the estimated growing costs and timely review and update the surveys and calculations. In addition, as with most taxing systems throughout the world and time, much obstruction and evasion was practiced by false reporting, bribery of government officials192 Tokugawa Law : How it Contributed to the Economic Success of Japan and other devices (e.g. hiding produce )2” The tax was a fixed proportion of the rice yield and was paid to the appropriate authorities, the daimyo hatamoto, or directly to the Bakufu, in kind. In general, however, perhaps primarily to avoid pro- liferating peasant uprisings, the tax rate was rela- tively stable during the Edo Period. The operation of the kokudaka tax system, due to a generally understated tax base and relatively stable tax rate combined with gradual but steady increases in rice production through improved farm- ing methods and implements, more efficient use of fertilizers and reclamation of farmland, as well as a generally stable population growth resulted in great- er amounts of excess rice available to the peasant- farmers which could be converted into money. Introduction of other agricultural products, such as cotton and other grains, and the development of the sericulture industry in the rural areas also added to the farmers’ coffers. This money was used to purchase other goods to satisfy the farmers’ needs and desires, thereby stimulating growth of the market place in both urban and rural areas. So as present-farmers derived increased benefits from the kokudaka land tax system , the merchants (and artisans/eraftsmen), whose tax burdens were sub- stantially less, and in most cases minimal, also benefited. SAMURAI FIXED RICE STIPENDS Oda Nobunaga (1534-1582) established the foundations for the big castletowns and established a strong and competent civil administration?’ Toyotomi Hidehoshi (1535-1598) revised the divi- sion of the socioeconomic classes by tying the peasant-farmers to the land with his cadastral land survey, registration system and taxing policies (taiko no kenchi) and his notorious "Sword Hunt" of 1588 (taiko no katanagari) creating a marked divi- sion (class distinction) between peasant-farmers and Samurai rulers, which was carried over into and continued by the Tokugawa Shogunate during the Edo Period. Tokugawa Ieyasu ( 1542-1616) and the resulting Tokugawa Shogunate tightened the noose around the necks of the Samurai class by separating it from fief holdings and requiring the middle and lower echelon Samurai to dwell and serve in the castle towns of their daimyo lords or in Edo in direct service the Shogunate. Concomitant with this relocation, the Shogunate established a fixed rice stipend for the Samurai, now landless without any means of production or of feeding themselves, measured by and paid in kind in rice. The fixed Samurai stipend paid only in rice eventually result- ed in economic disaster to them. The Samurai (including daimyo) began to sell their fixed rice stipends for currency (money) in order to purchase other necessities to maintain their lives and for luxuries * Unfortunately, debasement of coinage by the Bakafu, general inflation and natural disasters also ‘operated against them, The Samurai dove deeper in debt to the merchants. The merchants, rather than a pebble in the shoe, became the shoelace. Not even "The Three Great Reforms" (see infra) could re- surrect the Samurai from their perilous plight. On the other hand, despite Bakufu prohibitions against collection of Samurai debt by the merchants was not significant, whereas the Samurai, daimyo and the Shogunate itself, suffered traumatic economic ef- fects. The fixed rice stipend system diminished appreciably the buying power of the Samurai and enhanced the profit-making opportunities of the merchants. Despite the efforts of the Tokugawa Shoguns many former military elite Samurai dwind- Jed into ronin (masterless, unemployed soldiers) and became peasant-farmers artisans/craftsmen, mer- chants, laborers and even beggars. Those of the Samurai who survived the socioeconomic burdens of the Edo Period as a result of Tokugawa lawEET = GE aes | | eventually became the backbone of the Japanese bureaucratic governmental society. | THE THREE GREAT REFORMS The deteriorating financial condition of the Sho- gunate and the impoverishment of the Samurai class in general brought about by the breakdown of the Bakuhan system and the conversion from a rice economy to a money economy had reached such a devastating level that Yoshimune, the eighth Shogun (1716-1745), instituted a series of economic reforms during the 1730s and 1740s to correct the situation. This was followed by two other reform periods in the late eighteenth century and mid- nineteenth century. "The There Great Reforms” of the Tokugawa Shogunate were the Kyoho Reforms forms in 1787-1793, which were engineered by Matsudaira Sadanobu as of Yoshimune; the Regent(Senior Advisor) to the minor eleventh Sho- gun, lenari(1787-1873); and the Tempo Reform in 1841-1844, which was initiated by Mizuno Ta- dakuni as Chief Advisor to Ieyoshi(also a minor), the twelfth Tokugawa Shogun(1817-1853)2 Yoshimune became Shogun(at the age of 33) shortly after the Genroku Era(1688-1704), during which Tokugawa Japan’s urban society had reached its peak in lavish spending and life-style and the city merchants had reached a pinnacle of wealth and economic power at the expense of and to the detriment of the Samurai, This resulted from the enormous growth in urbanization in the seventeenth century referred to above. Yoshimune, a physically robust man had wide ranging interests in natural sciences and in foreign countries, which was un- usual for his time. He speculated on life outside Japan” Yoshimune was well qualified for the task of reform and the resurrection of the Bakufu System, although his reach seemed beyond his grasp. Sir George B. Sansom regarded Yoshimune as the second greatest of all Tokugawa Shogun next Gregory M. Bormann and Carl M. Bornmann 193 only to leyasu, the first Tokugawa Shogun, the great unifier and the founder of the Tokugawa Shogun” Yoshimune inherited a Bakufu in a deteriorated financial condition with government expenditures far exceeding revenues, reaching a critical point in 1721,” and an impoverished Samurai class. The dire circumstances which Yoshimune encountered were exacerbated by the occurrence of several natural disasters: drought, floods, conflagration, plague and famine throughout the first half of the eighteenth century. The various reforms instituted by Yoshimune included: currency reform - a shift to hard money from rice as the medium of exchange, together with coinage debasement; market reform- increased taxes on and “contributions” in rice by the daimyo; agricultural reform- encouragement of land reclamation to increase production and the introduc- tion of new crops, especially sweet potatoes as a substitute for rice in the food supply: trade credit reforms- a moratorium on merchants’ actions against Samurai for the collection of debts; and legal reform- reduction in the obligation of sankin kotai. ‘The economic effects of Yoshimune’s reform rather than providing a remedy, were to worsen conditions. As it tumed out, the cure was more crippling than the disease, The peasant-farmers, as a result of the combination of the devaluation of hard currency and lower prices, were adversely affected by having to use their stabilized of hard currency obtain cash in order to pay for increasingly more expensive products in cash. The peasant farmers were further squeezed by higher taxes. The mer- chants suffered hardship as a result of the re- strictions imposed on their collection of Samurai debts. Although Yoshimune did temporarily ex- tricate the Samurai from their deficit financial position, the overall results were economically disas- trous. Furthermore, despite Yoshimune’s resound- ing success in accumulating funds for the Bakufu194 ‘Tokugawa Law : How it Contributed to the Economic Success of Japan treasury by the time he retired in 1745, after his death in 1751 the funds were dissipated during the ruling periods of Ieshige (his son), the ninth Shogun (1745-1760), and Ieharu (his grandson), the tenth Shogun(1760-1787), over the next 40-45 years.*! In general, most of Yoshimune’s other reforms were essentially ineffective with one particular exception He created an effective functioning financial bu- Yoshimune attempted to reinstate the basic ag- rarian feudal system so carefully and artfully st- ructured by Ieysu, Hidetada and Jemitsu during the earliest years of the Tokugawa Shogunate. Pethaps Yoshimune was out of tune with his own times and failed to envision the difficulties in if not impos- sibility of , rolling back the times. Furthermore, it may be argued that Yoshimune failed to recognize that Ieyasu, like Hideyoshi, favored and encouraged a policy of free trade among the domains and open markets. He seems to have been economically myopic or to have ignored the rapid development of and transition toward, a "centralized feudal merean- tile economy" and the increasing use of money in place of the agrarian rice economy during the preceding century as a result of such policy.!”) In the case of the Kansai Reforms in 1787,’ just as Yoshimune had inherited a financially crippled Bakufu from lemitsu’s four successors. Matsudaira Sadanobu was again presented with a financially depleted Bakufu treasury caused by Yoshimune’s two successors.” Matudaira Sa- danobu’s reforms were more or less designed after those of Yoshimune, but the program came to an abrupt halt in 1793 when Ienari, the eleventh Shogun (1787-1837), himself took control over and administration of the government. Ienari again abolished financial retrenchment and restrictive practices over trade and entered into another period of liberal spendings® As a result, some wealthy peasant-farmers and a large number of merchant townsmen continued to prosper, while the Samurai continued to be impoverished along with most rural peasants. The foregoing events once again resulted ina financially deteriorated Bakufu, and again they were coupled with a natural disaster, the third great famine during the Tokugawa Period. The third attempt at reform, the Tempo Reform initiated by Mizuno Tadakuni in 1841-1844, as Chief Advisor to another minor, leyasu, the twelfth Shogun (1837-1853), was pitifully ineffectual‘? Mizuni Tadakuni was forced “to resign in disgrace in 1844," All of "The Three Great Reforms" were econom- ic and legal reforms brought about by deteriorating financial conditions in the Bakufu following periods of lavish spending by the government, concern for the impoverished Samurai class, the accumulation of wealth and economic power by the merchants and the shortage of food due to natural disasters. The common remedies invoked by all of these reforms involved fundamental principles of finan- cial retrenchment and restrictive controls over trade and commerce to preserve the Bakuhan system. All of the reform movements were essentially ineffe tive and are deemed to be failures. Events occurring from the mid-eighteenth century caused increasing antagonism toward the Shogunate and planted the seeds of and promoted the “loyalty movement" for the Emperor and the Meiji Restoration THE TANUMAERA Tanuma Okitsugu (1719-1788), although gener- ally considered by most historians to have been basically a corrupt knave with considerable moral turpitude and “universally pictured as an incarnation of corruption and official irresponsibility”.*® he nevertheless may be deemed to have produced more in the way of legal and economic advancement for the merchants and the country as a whole during the Edo Period than any of the Tokugawa Shoguns or| architects of "The Three Great Reforms". Apart from Jeyasu, Hidetada and Iemitsu (the first three Shoguns) and Yoshimune (the eighth Shogun), the other eleven Tokugawa Shoguns were either non- productive or anti-productive. All of the attempted reform movements fell of their own weight. But despite his reputed nefariousness, Tanuma, not as Shogun but as Senior Advisor to Ieharu, the tenth Shogun (1760-1786), actually ruled over the To- kugawa Shogunate from 1767 to 1786.” According to John Whitney Hall, he manipulated the legisla- tive body that “applied themselves strenuously enough to the task of reviving the fortunes of the Edo government and easing the distress of the people."* Tanuma, by his unorthodox methods and despite his lack of education, managed to manipulate people and operate the Bakufu system in a manner that resulted in "filling the Tokugawa Coffers"® more successfully and lastingly than any of his predecessors or successors. What did Tanuma contribute to Tokugawa law? Following Dan Fenno Henderson’s hypothesis, after the period of the first three Shoguns and the Yoshimune era, reported to be the most prominent periods of Tokugawa law.” the third most produc- tive legislatively active period of the Tokugawa Shogunate should be considered to be that which occurred under the non-shogunal leadership of Tanuma. Tanuma’s contribution to Tokugawa law, the rise of the merchant class and, in turn , the development of trade and commerce for the overall benefit of the entire country may even be deemed to have exceeded the legislative achievements of Yos- humune. Second only to that of the originators of Tokugawa law during the founding of the To- kugawa hegemony at the beginning of the seven- teenth century, "[T] he Tanuma age is an important pivotal period in Tokugawa history [and law." >" Tanuma, like Matsudaira Sadanobu and Mizuno Tadakuni, was a surrogate Shogun. Although he Gregory M. Bornmann and Carl M. Bornmann 195 was regarded as a charlatan by his adversaries, Sansom described him as “an acquisitive and far- sighted man, always on the look-out to expand and diversify the national economy."® His affirmative contribution to Tokugawa law which provided a basis for the rise of the merchant class and enhanced the economic welfare of Tokugawa Japan surpassed in major degree the attempts of the architects of "The Three Great Reforms", including Yoshimune. The Tanuma Era (1767-1786), following Yos- himune’s abortive efforts with the Kyoho Reforms (1716-1745), fostered the success of the merchants, which, until then, had reached its pinnacle during the Genroku Period (1688-1703); "The anger of the wealthy merchants of Osaka strikes terror into the hearts of the daimyo.” 5" THE RISE OF THE MERCHANT CLASS AND ECONOMIC GROWTH Cities were important and experienced tremen- dous growth in the seventeenth century because they were fundamental to the continuance of the Bakuhan system. As a direct result of the sankin kotai system, Edo and the castletowns became centralized consumer markets which required sup- plies from the many domains (over 250 in number) for food, manufactured goods and most all other commodities necessary to sustain the daimyo and even the treasury of the Shogunate. This sitnation was exacerbated by the combined existence of the kokudaka land tax system and the Samurai fixed rice stipends, coupled with the transformation into a money economy in order to accommodate the growing trade and expanding markets over wider geographical areas. In addition, this situation was further exacerbated by increasing inflation during the Edo Period and the infliction of natural disas- ters. Also working to the farmers’ advantage were the balancing factors of increasing farm production with a stable population growth having a positive196 Tokugawa Law : How it Contributed to the Economic Success of Japan net result to their benefit. THE RELATIONSHIP OF TOKUGAWA LAW TO THE ECONOMIC HISTORY OF JAPAN Important aspects of Tokugawa law resulted in the development of trade and commerce in Japan, the intermediation among the historically defined classes of society during the Edo Period, the rise of the merchants, the economic failure of the Samurai class and ultimately the failure to secure and maintain the hegemony of the Tokugawa Shogunate as it was designed to do. To the contrary, Tokugawa law helped to cause the demise of the Tokugawa Shogunate and at the same time created and sup- ported the economic institutions developed and utilized by the merchants to prepare Japan for modernization and rapid growth in the nineteenth century. ‘As Charles David Sheldon observed "There is little in the history of the Tokugawa period which is not relevant to the phenomenon of the rise of the merchant class."®) It was Tokugawa law that forebade Samurai from engaging money and finan- cial affairs and left the door open for the merchants not only to control but to exert substantial economic power over the Samurai, including the daimyo and the Bakufu itself. By virtue of so-called "central feudalism’, the Bakufu not only enabled but fos tered an economic base and increasing wealth and economic power for the merchants. John Henry "The study of To- kugawa law contains a ‘treasure house’ for the eco- Wigmore summarized it best: 56) nomic."*") A general understanding of a nation’s legal system and how the government is organized and administered is not only helpful, but essential, to any analysis of its economic institutions and how they operate. Tokugawa law affected all aspects regarding trade and commerce among the Samurai peasant- farmers, artisans/craftsmen and merchants.” THE EFFECT OF TOKUGAWA LAW ON THE CLASS STSTEM The Edo Period began the era, engendered by Tokugawa law, of Japanese traders and financiers rather than warriors and farmers. The Samurai class mostly became reluctant ronin that reincarnated into bureaucrats, administrators in the government, while even farmers, by their by-employments and| wholesalers and cus-| direct dealings with retailers, tomers outside their own domains (han), became| merchants of a kind. A distinct group of townsmen, villagers, former Samurai and former (or by-lane)} Peasant-farmers which arose from the evolution of the urbanization of Tokugawa Japan, resulting in the| dynamic growth of the three supercities of Edo, Osaka and Kyoto, more effective transportation and| communication systems, ever increasing by-emp- loyments in rural villages, more mobility of persons from villages to castletowns and cities and the| concomitant rise in building and construction on| land for sea travel, was the primary beneficiary of Tokugawa law. Although clear distinctions in the class system were designed to be drawn by continuation, adop- tion and enforcement (or lack thereof) by the central government of the Tokugawa Shogunate (the Ba- kufu) , eventually, however, Tokufawa law, despite] its intended rigid reinforcement of the class system, resulted in a shifting of persons from one class to another because of its economic effects and conse- quent benefits. Samurai became farmers, ar- tisans/eraftsmen or merchants. Farmers became merchants. Many Samurai slipped "downward" into the class of merchants or artisans/craftsmen. But there is no evidence that a merchant ever became part of the peasant-farmer class, even though theo- retically that would have been a “step up" in the historically determined class system prior to the events of the Edo Period. It would appear that| Sheldon’s observation that merchants in the villageswere part-time farmers was no more than lip-service by local authorities to justify the presence of merchants in order to sell their goods to the villagers, which was legally prohibited.® Ironically, the class distinctions solidified by Hideyoshi and intended to be preserved infinitely by the Tokugawa Shogunate, through the continu- | ation and adoption of laws, had the reverse effect. During the Edo Period, the class distinctions began to blur and blend. The Samurai class deteriorated and the merchants and artisans/craftsmen grew in wealth and economic power. The distressed Sa- murai began to hover over the merchants like months attracted to a lighted candle. Several writers have distinguished between the economic and po- litical power of the merchants and the Samunrai in Tokugawa Japan, but such a distinction may be somewhat ambiguous and in some cases a distine- tion without a difference. It is difficult to imagine any society in which economic power does not have any. if not significant, influence on political matters. The legal structure of Tokugawa Japan, the Bakuhan system, not only permitted, but enhanced the economic dominance of the merchants, and as Sheldon observed, there was a "fusion of merchant and Samurai values."®* The Bakuhan system con- sisted of a duality of a centralized political-military authority to ensure the loyalty of the daimyo to the Shogunate while at the same time granting local autonomy to the various 250-260 domain(han) to the daimyo with a great deal of legal authority. In turn, as a result of the customery law which established the Samurai’s disdain for matters in- volving trade, commerce and all manner of finance and economics, the efforts of the Shogunate to concentrate the economic welfare of Tokugawa Japan in the cities, castletowns and villages rested on the backs of the pivotal group of merchants, waders, money handlers and artisans/craftsmen- the service oriented and profit motivated segment of Gregory M. Bormann and Carl M. Bornmann 197 Tokugawa society. The merchants, the smallest productive segment of Tokugawa Japan’s populace, became the lubri- cant that enabled the wheels of Tokugawa trade and commerce to spin. The peasant-farmers as the outer Wheel were joined by the spokes of the merchants to the wheelhub, providing the accumulation, storage, and distribution centers for the principle consumer centers. The commercial vehicle through which the daimyo of the various han entrusted the sale of rice and other products to the merchants of Osaka, who were also permitted to manage the flow of gold, silver and other goods into and out of the han and Osaka/Kyoto and between Osak/Kyoto and Edo, for which the merchants received treatment equal to that of the Samurai and special in conducting trade is described in some detail in Toyoda.” CONCLUSION Because of various legal mandates by the To- kugawa Shogunate, e.g., sankin kotai (the alterna- tive attendance system), kokudaka (the land tax system), Samurai fixed rice stipends and the encour agement of free trade in open markets, as well as the Shogunate separating the interests of the Emperor and the Royal Court from the Bakufu and the Samurai (including the daimyo), the Bakuhan sys- tem generated the consolidation and solidification of mutual interests of the merchants and the pea- sant-farmers, Even the Samurai, mainly in the middle and lower echelons, became absorbed into this commercial society, forsaking bushido, the Samurai Code, for the world of profit making, the "Merchants? Code". ** The merchants defied classism and promoted not only individualism but nationalism. With the aid of established and adopted legal practices, the mer- chants and artisans/craftsmen provided for the de- velopment of a national market system and a national transportation and communication system198 Tokugawa Law : How it Contributed to the Economie Success of Japan Tokugawa law, in effect, merged the 250-260 separate unrelated domains (han) into a central market place and nationwide distribution system upon which the entire country was dependent. At the same time, the merchants promoted individual entreprenuership and realized emoluments and per- quisites from trading in goods and services at the expense of the bifurcated ruling elite, the Samurai ‘The Tokugawa Shogunate, in what it believed to be infinite wisdom and strength brought about by its legal structure and policies, greatly enhanced the power and value of the merchants rather than that of the Samurai, and provided for the commercial growth of Japan, an unforeseen reality. Instead of, stagnation and isolation envisioned by the To- kugawa Shogunate, the merchants capitalized on and profited by the legal mechanisms (or lack thereof) employed by the Shogunate. Even those laws or supposed legal sanctions designed to inhibit the economic growth and power of the merchants fell of their own weight. failed from lack of adequate means of enforcement and corruption or otherwise proved to be unfeasible. The fall of the Tokugawa Shogunate, however, is more than overshadowed by the legacy it left for Japan in the future, regardless of how inadvertent and certainly unintended it was. The effects of its loosely controlled and at time inept government were a blessing in disguise. The Tokugawa Sho gunate collapsed to a under the self-induced pres: sures of mercantilism and the creation and develop ment of a competitive market system. Those cir: cumstances provided Japan with the necessa foundation to make a quantum leap into the modern international world of trade and commerce, To: kugawa law during the Edo Period gave rise to th merchants, the beginnings of a centralized mercan tile economy and Japan’s preparation to conten: with competition in the international market plac into which it was thrust near the end of the Ed Period The eminent American teacher, scholar and sta: tesman, Edwin O.Reischauer concluded that "Japan| far from becoming a stagnant society in its isolatior [during the Edo Period], remained capable of great change, as it was demonstrated brilliantly in the| second half of the nineteenth century." ® The commercial drive of the big city merchant and a surge of peasant entrepenuers in the late| eighteenth and early nineteenth centuries prepared| the Japanese well for the modern age of internation al business. NOTES 1) John W, Hall Studies in the Institutional History of Early Modem Japan("SHIMS "The Castle Town and Japan's Modern Urbanization”, in John W, Hall and Marious B. Jansen(eds.), Princeton: Princeton University Press, 1968, Ch.10, Gilbert Rozman, "Edo’s Importance in the Change Tokugawa Society". The Journal of Japanese Studies("JJS"), Vol. 1, No, 1, p.1{Autumn 1974). Gilbert Rozman. "Castle Towns in Transition", and Henry D. Smith, “The Edo-Tokyo| Transition: In Search of Common Ground”, in Marious B. Jansen and Gilbert Rozman (eds,). Japan in ‘Transition-From Tokugawa to Meiji ("JIT"), Princeton : Princeton University Press, 1986. Chs. 12 and 13. George Sanaom : A History of| Japan 1615-1867 ("AHOJ"), Stanford: Stanford University Press. 1963. Ch.IX. Takeshi Toyoda : A History of Pre-Meiji (Commerce in Japan("HPMC"). Tokyo: Kokusai Bunka Shinkokai (Japan Cultural Society ) 1969. 2) Thomas C. Smith : The Agrarian Origins of Modem Japan(”AOMI").Stanford: Stanford University Press, 1959. Sansom, AHOJ, Ch. VIL 3) Id, See, also, Smith “Population Change” In JIT. Ch.ll; Susan Hanly and Kozo Yamamura “The Japanese Village in the Seventeenth Century”. in SIMHJ. pp. 263-282: Akira Hayami, “Population Trends and Economic Growth inGregory M. Bornmann and Carl M. Bornmann 199 Pre-Industrial Japan.” in D.V. Glass and Roger Revelle (eds.), Population and Social Change, P.451-499, London: Edward Amold, 1972. 4) Osamu Saito : “The Rural Economy: Commercial Agriculture. By Employment, and Wage Work, in JIT, Ch. 15, Thomas C, Smith, Native Sources of Japanese Industrialization. 1750-1920(’NSJI"). Berkeley: University of California Press. 1988. Ch.3. William B Hauser. Economic Institutional Change in Tokugawa Japan- Osaka and the Kinai Cotton Trade, London : Cambridge University Press. 1974, Sansom, AHOJ. Ch X. Thomas C. Smith : "Farm family By-employments in Pre-industrial Japan, "The Journal of Economic History. Vol 29, 687-715(Dec..1 969). 5) Mikio Sumiya and Koji Taira(eds.), An Outline of Japanese Economic History 1603-1940("OJEH"), Tokyo, Japan: University of Tokyo Press, 1979 6) Smith NSJL 7) R.P. Dore ; Education in Tokugawa Japan, Berkeley: University of California Press. 1965. Ronald P. Dore. "The Legacy of Tokugawa Education”. in Marious B Japan(ed.). Changing Japanese Attitudes Toward Modemization, 1965, 8) Toshio G, Tsukahira, Feudal Control in Tokugawa Japan: The Sankin Kotai University Press. 1966. System ("SKS"), Cambridge. Mass.: Harvard 9) Charles David Sheldon, The Rise of the Merchant Class in Tokugawa Japan. 1600-1868-An Industrial Survey ("RMC’), New York: Russell& Russell, 1959. 10) See, eg. John Henry Wigmore(ed), Law and Justice in Tokugawa Japan ("LJTJ"1, Tokyo. Japan: University of Tokyo Press, 1969-1985(10 Vols.). John Carey Hall : Japanese Federal Law ("JFL"), Washington. D.C.: University Publication of America, Inc., 1979,Dan Fenno Henderson, Conciliation and Japanese Law-Tokugaw. and Modem. Tokyo, Japan: University of Tokyo Press, 1965,(2 Vols.): "The Evolution of Tokugawa Law”. in SIHMJ. pp. 203-229: “Some Aspects of Tokugawa Law", 27 Wash.L.Rev.85 (1952), and “Contracts in Tokugawa Villages”. JIS. Vol.1. No.L.p. 51. See, also, Yoshiru Hiramatsu (tr, Dan F, Henderson), "Tokugawa Law. in Law Japan-An Annual. Vol. 14:1(1981), Japanese American Society for Legal Studies, pp. 1-48 11) George Sansom, A History of Japan 1334-1615, Stantord: Stanford University Press. 1961.pp. 330-340. 12) Sumiya and Taira, OFEH. p.57, 13) Hahm. Pyong-Choon, The Korean Political Tradition and Law, Seoul: Hollym Corporation. 1967. p. i 14) About 80 percent of the country consists of mountainous. unarable land. See, Reischaver, The Japan Today. p.5. 15) Sansom. A History of Japan 1615-1687. p. 119. See in general, Ihara Saikaku. The Japanese Family Storehouse, London Cambridge University Press, 1969. 16) Sansom, Japan - A Short Cultural History. p. 458. 17) Sansom. Japan- A Short Cultural History. p. 461: Hall, JFL. p. 100, et seq.: Henderson, "Some Aspects of Tokugawa Law", P.90. 18) Ibid., p. 462 19) Sansom. Japan-A Short Cultural History. p.90. See. also, Yoshiro Hiramatsu, "Tokugawa Law”, Law in Japan-An Annual, Vol. 14:1 (1981). p.p. 5-7 20) Sansom, A History of Japan-1615-1867, p.20; Hall. JFL, pp. 105-109 W.G. Beaseley, The Meiji Restoration, Stanford: Stanford University Press, 1972.pp. 17-18. Tsukahira, SKS,p.1 21) Henderson. "Some Aspects of Tokugawa Law’. p.90. 22) See, generally, Wigmore, LIU, Part IV B. Contract: Commercial Customary Law, Tokyo: University of Tokyo Press, 1985 23) Akio Morita, Made in Japan, New York: E.P Dutton, 1986, p. 86. 24) See, Tsukahira. SKS. This is by far the most thorough and informative of this topic and its economic effets. Smith NSH. Ch. 2:Smith. AOMJ.Ch. 1, and Wakita Osamyu . "The Kokudaka System: A Device for Unification", JIS200. ‘Tokugawa Law : How it Contributed to the Economic Success of Japan Vol.1, No.2.p.297. 26) Sumiya and Taira, OJEH. pp. 26 and 32 27) See, Jansen and Rozman, JIT, Chs. 12 and 13; Sansom, A History of Japan 1615-1867, ChIX. 28) Sheldon, ROMC, p.13 29) See, Henderson, "Some Aspects of Tokugawa Law”, 27 Wash.L.Rev. 85 (1952). See, also, Wigmore, LITY, Part 1; Hall, JFL. 30) Tsukahira, SKS, p.t 31) Sansom, A History of Japan 1334-1615, pp. 316-320. Wakita Osama, "The Kokudaka System: A Device for Unification”, JIS, Vol, No.2.p.297. 32) Sansom,A History of Japan 1334-1615, p. 303. 33) Sumiya and Taira, OJEH,p.32. 34) See, in general, Sansom, A History of Japan 1615-1867. Chs. XII and XVI and pp.221-226. Ienari as the longest ruling “Tokugawa Shogun - a period of 50 years. S som, A History of Japan 1615-1867, p.201. 35) Sansom, A History of Japan 1615-1867, pp.154 and 168-169. Yoshimune’s other activities included astrology and correcting the calendar, lifting the ban on foreign books and promoting the "Dutch Studies”, and introducing new agricultural products into Japan. Sansom, A History of Japan 1615-1867. pp. 169-170. 36) Sansom, A History of Japan 1615-1867, p.171 37) Ibid., p.155 38) Both Ieshige and Teharu were weak, feeble and incompetent. Ieshoge had a serious speech impediment and nervous disorder. He had to rely on his Chancellor in affairs of state. Jeharu essentially ignored the administration of government and left control of the Bakufu to his famous Chancellor. Tanuma Okitsugu, a very corrupt dealing persom prone to accept bribes for Bakufu favors. Sansom, A History of Japan 1615-1867. Ch. XIV, See "The Tanuma Era’. infra. 39) Sansom. A History of Japan 1615-1867, p. 162. 40) See, Smith AOMJ. pp. 72-73. Sansom, A History of Japan 1615-1687, pp. 155-168 41) See, in general.. Sansom. A History of Japan 1615-1867, Ch. XVI 42) See, note 35 and accompanying text, supra. 43) In effect, lenari repeated the policies, performance and activities of leshinge and leharu during the period 1741-1787. 44) As one example, Mizuno issued as edict requiring all “rural” people located in cities and towns to return to their villages and farms in order to increase the rural population. The edict was totally ignored. 45) Sansom , A History of Japan 1615-1867, p. 226. 46) Hall, Tanuma, p. 14 47) See, Sansom, A History of Japan 1615-1867, pp. 174-177. 48) Hall, Tanuma, p.18. 49) Ibid, pp. 57-86 50) Henderson, "Some Aspects of Tokugawa Law”, p.90. 51) Hall. Tanuma, p.19. 52) Sansom, A History of Japan 1615-1867, p.189. 53) Sheldon, ROMC. pp. 112-115 54) Ibid., p. 114 55) Sheldon, ROMC. p.1X. 56) Wigmore, LITJ, Part 1: Introduction, p. xv. 57) Id. 58) Sheldon, ROMC. p.27. 59) Ibid., p.220Gregory M. Bornmann and Carl M. Bornmann 201 60) Toyoda, HPMC, pp. 60-61 and 69. 61) During the period 1853-1867, the last three Tokugawa Shoguns: lesada (1853-58). lemochi(1858-66) and Yos- hinobu( 1866-67), merely presided over the demise of the Tokugawa Shogunate. 62) Reischauer, The Japanese Today, Cambridge: Harvard University Press, 1988, p.77. 63) Ibid., p.77. THE TOKUGAWA SHOGUNS First Shogun leyasu 1603-1608 Second Shogun _Hidetade 1605-1623 Third Shogun Temitsu 1623-1651 Found Shogun _—_Tetsuna 1651-1680 Fifth Shogun Tsunayoshi 1680-1709 Sixth Shogun Jenobu 1709-1712 Seventh Shogun Tetsugu 1713-1716 Eighth Shogun Yoshimune 1716-1745 Ninth Shogun Teshige 1745-1760 Tenth Shogun Teharu 1760-1786 Elevemth Shogun Tenari 1787-1837 Twelfth Shogun leyoshi 1837-1853 Thirteenth Shogun Tesada 1853-1858 Fourth Shogun Iemochi 1858-1866 Fifteenth shogun Hitotsubashi 1866-1867 OUTLINE OF EVENTS IN THE EDO (TOKUGWA) PERIOD 1600---1868 1600. Battle of Sekikahara-Victory of Tokugawa leyasu. 1603 _Teyasu appointed Shogun- beginning of the Tokugawa Shogunate. with its eapital in Edo. 1615. Battle of Osaka-final defeat of Hideyshi supporters. Ieyasu promulgates the "Laws for the Military Houses” (Buke Shohatto). 1616 Death of Ieyasu, Hidetada- Second shogun. 1617 Renewed persecution of Christians and expulsion of foreigners from Japan. 1623. lemitsu - Third Shogun, 1624 The Spanish are expelled from Japan 1637-38 | Shimabara Rebellion- total slaughter of Christians, Japanese forbidden to Travel abroad. 1639 Expulsion of the Portuguese. Thereafter no one could enter or leave Japan, except for a small number of Dutch and Chinese traders 1651 letsuna-Fourth Shogun. 1657 Great Fire in Edo. 1660 Beginning of the Mito [nationalist} school of historians, which began the monement to undermine the Shogunate and eventually led to the Imperial "Restoration". 1680 Tsunayashi-Fifth Shogun. Corrupt administration; free spending. 1687-1703 Genroku Period - high living and free spending in the cities - Edo, Osaka, ete 1709 _Ienobu-Sixth Shogun, Reaction against Tsunayoshi’s reign. Attempted financial reforms. 1713. Tetsugu-Seventh Shogun. 1716 Yoshimune-Bighth Shogun, Atempt to reform administration, Relaxation of edicts against Western learning. 1745. Ieshige - Ninth Shogun,202 Tokugawa Law : How it Contributed to the Economic Success of Japan 1760 _Icharu - Tenth Shogun. 1783-87 Rice riots. Matsudaira Sadanobu, Regent to Ienari, attempts economic and social reforms. 1787 _Ienari- Eleventh Shogun. Serious famines and epidemics. 1791-92 American and Russian ships visit Japan, but are tumed away. Decrees against foreign intercourse are issued. 1837 leyoshi - Twelfth Shogun, 1838 Continued famines and economic difficulties combine with growing foreign pressure and internal financial problems weaken the Shogunate. 1853 lesade - Thirteenth Shogun. Commodore Perry’s "Black Ships” arrive in Edo Bay. 1854 Perry returns and treaty is entered into between the United States and Japan, followed soon by treaties with other nations. Japan’s national reclusion policy comes to an end. 1858 Temochi-Fourteenth Shogun. 1866 Hitotsubashi( Yoshinobu) Keiki-Fifteenth (last ) Tokugawa Shogun. 1867-68 The last Tokugawa Shogun resigns and the Imperial monarchy is restored under the Emperor Meiji, establishing "The Meiji Restoration”. The capital is moved from Kyoto to Edo( Tokyo). SOURCES ‘Sansom, George, A History of Japan 1615-1867. Stanford. Stanford University Press, 1963 Sanson, G. B., Japan- A Short Cultural History, Stanford, Stanford University Press, 10978, pp. 528-29. Morris, Ivan, The Nobility of Failure, New York. The Noonday Press (Paperback Edition), 1988, pp. xviii-xix.