JAPANESE LINEAGE OF KOREA'S"DEVELOPMENTAL STATE" 1279 is worthy of attention.Rice production and Japanese unique in the comparative history of colonialism:the ownership of Korean land were both more concen- average,annual rate of growth in industry (including trated in the southern half of Korea.Bulk of rice mining and manufacturing)during 1910-40 was exports also originated in the South.The southern half nearly 10%;and by 1940,nearly 35%of the total com- of Korea thus developed a relatively productive agri- modity production originated in the industrial sector culture during the colonial period. (Suh,1978,p.48,Table 11;and p.46,Tables 17 and To conclude this discussion on the changes in the 18).While analyzing the why and how of this experi- agrarian sector,two developments of long-term con- ence below,as well as its long-term significance,the sequence need to be underlined.The nearly obvious main point is not that South Korea somehow inherited point is that a productive agriculture was a necessary a relatively industrialized economy.It did not!A component of rapid economic growth,first during fair amount of the heavy industry was located in the colonial Korea.and later.even more prominently.in north and significant industrial concentrations were sovereign South Korea.While many developing destroyed during the Korean war.Nevertheless,a war- countries,such as in Africa,are still attempting their destroyed economy,with an experience of rapid agricultural revolution.and others,such as India and industrialization hehind it,is quite different than a tra- the Philippines,hailed the Green Revolution from the dition-bound,nearly stagnant,agrarian economy.I mid-1960s onward,Korea was already undergoing a will return below to the issue of the creation of a biological revolution in agriculture in the first half of trained and disciplined working class.At the apex of this century.Just before WWIl,rice yields in Korea the social pyramid,and from the standpoint of the were approaching Japanese yields,which were then colonial legacy,several issues of long-term signifi- among the highest in the world (e.g.,if the US yields cance deserve our attention here:the style of develop- in 1938 were 100,Japan's were 154 and Korea's 111) ment,especially a state-dominated,state-private sec- (Grajdanzev,1944,p.87;and Ishikawa,1967,p.95, tor alliance for production and profit that emerged Charts 2-5).Rapid increase in agriculture production, under Japanese rule;the emergence of a significant in turn,provided both food and inputs to sustain an entrepreneurial strata among Koreans;and a growing industrial drive on the one hand,and on the other economy whose structure was already heavily export hand,yielded high incomes and savings that found oriented. their way back into a growing economy.A decade The Japanese approach to Korea's industrializa- hence,after land reforms were implemented in South tion went through three more or less distinct phases. Korea,the productive agricultural base and related During the first decade of the colonial rule,Japan incomes also contributed to the emergence of a sought to protect Korean market as an outlet for domestic market for manufactured goods. Japanese manufactured goods.Rules and regulations The other less obvious legacy concerns the"model were thus created to inhibit the start up of new facto- of development that undergirded the agrarian trans- ries in Korea by both Japanese and Korean entrepre- formation.As in Meiji Japan,but even more so,the neurs.The fact that annual growth rates in the manu- colonial state in Korea established its superonty as facturing sector during this decade still averaged a the key actor that would direct economic change.The respectable 7%,reflected the very low starting base. state then employed various carrots and sticks to This growth had several components.First,there were incorporate the propertied groups in a production-ori- the new public sector investments in power,railways ented alliance.A key focus of the state's efforts was and other infrastructure.The private sector growth improving the technology of production.namely,bet- originated mainly in food processing industries- ter seeds,fertilizer and irrigation.Even after decolo- especially rice mills-that were initiated by Japanese nization,these efforts left behind a bureaucratic infra- migrants with the hope of selling rice back to Japan. structure that was adept at facilitating technology- Exchanging Japanese manufactured goods for Korean intensive agricultural development.Moreover,public rice and other primary products was,of course,the ini- subsidies from the colonial state helped improve the tial colonial policy.The Government-General thus profitability of private producers,as well as produc- helped Japanese entrepreneurs start up these mills by tivity and production.This pattern of state and proper- providing both financial and infrastructural support. tied class alliance for production,centered around Finally,some of this early growth also involved the technology and other public subsidies.would of participation of Koreans.Small-scale manufacturing course repeat itself in subsequent periods,and in did not require the permission of the Goverment- numerous other economic activities,especially in General.Moreover,incomes of landowning Koreans industry.to which I now turn had started to rise and not all of their demand could be met by Japanese imports.Emulating the Japanese (c)The state and industrialization migrants,Koreans set up small industries (often called household industries in Japanese colonial documents: The extent of Korea's industrialization during the they employed 10-20 workers)in such areas as colonial phase was both considerable and nearly metals,dyeing,paper making,ceramics,rubber shoes,JAPANESE LINEAGE OF KOREA’S “DEVELOPMENTAL STATE” I279 is worthy of attention. Rice production and Japanese ownership of Korean land were both more concen￾trated in the southern half of Korea. Bulk of rice exports also originated in the South. The southern half of Korea thus developed a relatively productive agri￾culture during the colonial period. To conclude this discussion on the changes in the agrarian sector, two developments of long-term con￾sequence need to be underlined. The nearly obvious point is that a productive agriculture was a necessary component of rapid economic growth, first during colonial Korea, and later, even more prominently, in sovereign South Korea. While many developing countries, such as in Africa, are still attempting their agricultural revolution, and others, such as India and the Philippines, hailed the Green Revolution from the mid- 1960s onward, Korea was already undergoing a biological revolution in agriculture in the first half of this century. Just before WWII, rice yields in Korea were approaching Japanese yields, which were then among the highest in the world (e.g., if the US yields in 1938 were 100, Japan’s were 154 and Korea’s 111) (Grajdanzev, 1944, p. 87; and Ishikawa, 1967, p. 95, Charts 2-5). Rapid increase in agriculture production, in turn, provided both food and inputs to sustain an industrial drive on the one hand, and on the other hand, yielded high incomes and savings that found their way back into a growing economy. A decade hence, after land reforms were implemented in South Korea, the productive agricultural base and related incomes also contributed to the emergence of a domestic market for manufactured goods. The other less obvious legacy concerns the “model of development” that undergirded the agrarian trans￾formation. As in Meiji Japan, but even more so, the colonial state in Korea established its superiority as the key actor that would direct economic change. The state then employed various carrots and sticks to incorporate the propertied groups in a production-ori￾ented alliance. A key focus of the state’s efforts was improving the technology of production, namely, bet￾ter seeds, fertilizer and irrigation. Even after decolo￾nization, these efforts left behind a bureaucratic infra￾structure that was adept at facilitating technology￾intensive agricultural development. Moreover, public subsidies from the colonial state helped improve the profitability of private producers, as well as produc￾tivity and production. This pattern of state and proper￾tied class alliance for production, centered around technology and other public subsidies, would of course repeat itself in subsequent periods, and in numerous other economic activities, especially in industry, to which I now turn. (c) The .state and industrialization The extent of Korea’s industrialization during the colonial phase was both considerable and nearly unique in the comparative history of colonialism: the average, annual rate of growth in industry (including mining and manufacturing) during 1910-40 was nearly 10%; and by 1940, nearly 35% of the total com￾modity production originated in the industrial sector (Suh, 1978, p. 48, Table 11; and p. 46, Tables 17 and 18). While analyzing the why and how of this experi￾ence below, as well as its long-term significance, the main point is not that South Korea somehow inherited a relatively industrialized economy. It did not! A fair amount of the heavy industry was located in the north and significant industrial concentrations were destroyed during the Korean war. Nevertheless, a war￾destroyed economy, with an experience of rapid industrialization behind it, is quite different than a tra￾dition-bound, nearly stagnant, agrarian economy.3y I will return below to the issue of the creation of a trained and disciplined working class. At the apex of the social pyramid, and from the standpoint of the colonial legacy, several issues of long-term signifi￾cance deserve our attention here: the style of develop￾ment, especially a state-dominated, state-private sec￾tor alliance for production and profit that emerged under Japanese rule; the emergence of a significant entrepreneurial strata among Koreans; and a growing economy whose structure was already heavily export oriented. The Japanese approach to Korea’s industrializa￾tion went through three more or less distinct phases. During the first decade of the colonial rule, Japan sought to protect Korean market as an outlet for Japanese manufactured goods. Rules and regulations were thus created to inhibit the start up of new facto￾ries in Korea by both Japanese and Korean entrepre￾neurs. The fact that annual growth rates in the manu￾facturing sector during this decade still averaged a respectable 7%, reflected the very low starting base. This growth had several components. First, there were the new public sector investments in power, railways and other infrastructure. The private sector growth originated mainly in food processing industries - especially rice mills-that were initiated by Japanese migrants with the hope of selling rice back to Japan. Exchanging Japanese manufactured goods for Korean rice and other primary products was, of course, the ini￾tial colonial policy. The Government-General thus helped Japanese entrepreneurs start up these mills by providing both financial and infrastructural support. Finally, some of this early growth also involved the participation of Koreans. Small-scale manufacturing did not require the permission of the Govemment￾General. Moreover, incomes of landowning Koreans had started to rise and not all of their demand could be met by Japanese imports. Emulating the Japanese migrants, Koreans set up small industries (often called household industries in Japanese colonial documents; they employed l&20 workers) in such areas as metals, dyeing, paper making, ceramics, rubber shoes