War and Economy in Southeast Asia: The economics of the World War II Japanese occupation and its aftermath

Lead Research Organisation: University of Oxford
Department Name: History Faculty

Abstract

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Publications

10 25 50
 
Description This project analyzed the economic and social impact of the World War II Japanese occupation on Southeast Asia and its six main countries of Burma, Thailand (Siam), Malaya (including Singapore), Indonesia, Indochina and the Philippines. In each of three main research areas, research findings answered a number of questions and in so doing contributed findings that, taken together, contribute significantly to knowledge of wartime Southeast Asia and the region's 1940s economic history.
By May 1942, when Japan controlled all of Southeast Asia, a key issue, and one of the three research areas, was Japan's administration of the region, its microeconomic policies and their impact. Research revealed that the occupation's most fundamental administrative division emerged as Japan came under severe pressure due to military reversals and resource shortages. The Japanese response of instituting autarky not just in countries but small national regions emphasized the relevance of the microeconomic questions identified. One finding was the near ineffectiveness in mobilizing production of a Japanese strategy of command economies and large corporations to replace markets and producer incentives. Small farmers, the largest constituent of Southeast Asian agriculture, cut back output when almost no consumer goods were available in exchange and when high inflation devalued money. Japanese administrators, spread thinly over Southeast Asia's 1.7 million square miles, could not enforce high production. Data on Southeast Asian production, collected for the research area of macroeconomic effects, show sharp output declines (article: "The Japanese occupation of World War II Southeast Asia"; "The Great Famine in Vietnam, 1944-1945").
A principal finding on the health and nutritional impacts of occupation was that, especially under autarkic conditions and growing transport shortages, pre-war divisions between areas specializing in food and non-food production assumed great importance in explaining differential wartime nutritional outcomes. The standard explanation was that in Southeast Asia's major cities, when food was short, people left to return to subsistence farming. Investigation of urban-rural dichotomies resulted in two publications (articles: "Export-led Growth, Gateway Cities and Urban Systems Development in Pre-World War II Southeast Asia"; "Finance and Long-term Development Issues in Southeast Asia"). These led to a further paper in conjunction with an RA on the project ("Urban Growth and Change in 1940s Southeast Asia"). Famine in Southeast Asia was shown to be an overwhelmingly rural phenomenon. Under conditions of food shortage, people migrated to cities. Black markets were documented as fundamental in preventing widespread urban starvation. It was found that, because of this and post-war upheavals, the million city in Southeast Asia was a 1940s occurrence, not one of the 1950s as many had thought ("Urban Growth and Change in 1940s Southeast Asia"; Urbanization in Southeast Asia during the World War II Japanese Occupation and Its Aftermath).
During the Japanese occupation, famine claimed between an estimated one million and two million lives in Tonkin and North Annam in Vietnam and between two and three million in Java. Famine analysis divides into two strands. One is to explain famines principally by a lack of available food, so-called food availability deficit (FAD) famines. The alternative approach, associated with the work of A. K. Sen, is the view that there existed a food supply large enough to feed everyone if more equally distributed. An important research finding was to show, for the first time, that the initial cause of both the Vietnamese and Javanese famines was a decline in food availability. In Vietnam, this resulted from a succession of typhoons that hit coastal areas just before the November 1944 harvest and in Java from a combination of bad weather and low, administered prices for rice. The project was able to show how war-related conditions then made the famines much worse than they would otherwise have been.
Japan, badly short of resources and capital, favoured highly labour-intensive construction and production methods in Southeast Asia (article: "The Japanese occupation of World War II Southeast Asia"). Findings document hundreds of thousands of Southeast Asians working (often as forced labour) with little more than their bare hands. The Siam-Burma railway is one example. It was also one of the Japanese strategies to counter transport shortages and Southeast Asia's north-south geography. The military needed to move men and supplies east-west.
In the second main area of macroeconomics, research yielded the first set of GDP statistics for wartime Southeast Asia (working paper: Financing Japan's World War II Occupation of Southeast Asia; data on GDP along with data on money supply, urbanization and trade deposited with the Essex data base). Falls in GDP rank as among the greatest macroeconomic shocks in nineteenth- and twentieth-century world economic history. Findings on finance show that Japan financed occupation chiefly by printing money (article: "Financing Japan's World War II Occupation of Southeast Asia"); that Southeast Asians transferred as much as a third of national income for Japanese use; and that Japan gained little in Southeast Asia in goods, food or strategic materials (articles: "Financing Japan's World War II Occupation of Southeast Asia" and "Paying for War, 1941-1945: How Japan Financed Southeast Asia's Occupation").
Through work on Japan's financing for war in Southeast Asia, I was able to extend research beyond Southeast Asia to show how World War II was financed in China and in Japan itself. In China, different financial regimes were operated by the Japanese, by the Nationalist Chinese government and by the communists. A result of this extension of research has been the first comparative study of war finance and its aftermath in Asia between 1937 and 1950. The research, which appears in The Cambridge History of the Second World War, provides an authoritative but accessible understanding of a previously little understood aspect of World War II in Asia and shows how paying for war relied on combinations of monetary creation, selling bonds and taxing populations, often through inflation.
The legacies of World War II for Southeast Asia were the third main research area. Independence would not have come so quickly or with such upheaval in the absence of the Japanese occupation. The war's abrupt end in August 1945 created a political vacuum before Allied troops arrived. It allowed chaotic conditions to develop over much of Southeast Asia. Nevertheless, the project's finding reject this as the principal explanation of a post-war divergence in politics and economics of Southeast Asian regimes and favour instead differing pre-war experiences under colonialism as the single most important determinant (article: "The Japanese occupation of World War II Southeast Asia"). An important outcome of the Vietnam famine was its key role in bringing to power the communist government of Ho Chi Minh and the Viet Minh.
Exploitation Route Remarkably little research exists on the Japanese World War II occupation of Southeast Asia and little about it, the story of the Siam-Burma railway excepted, seems generally to be known. Already published journal articles have a scholarly impact and will be taken forward by scholars now and in the future, for example in providing the first GDP data for wartime Southeast Asia and in explaining how Japan financed its occupation of the region without actually paying for anything).

A published book (in progress, see above) will likely be the route which has the principal impact on the wider public and which those in the media will turn to when researching World War II in Asia and Southeast Asia.
Sectors Education,Government, Democracy and Justice,Security and Diplomacy

 
Description Finding of the project found use in education, both in scholarly research and in teaching on Southeast Asia during, before and after World War II. They have also found use in financial policy in contributing to an understanding of tools of government finance and the use of money supply and seigniorage in this.
First Year Of Impact 2011
Sector Education,Financial Services, and Management Consultancy,Security and Diplomacy
Impact Types Economic

 
Title Japan World War II Expenditure 
Description Data on Japanese Spending during World War II in Japan and Outside the Home Islands 
Type Of Material Database/Collection of data 
Year Produced 2013 
Provided To Others? Yes  
Impact Makes available data on Japanese wartime spending used by researchers to compare with other countries' expenditure 
URL http://reshare.ukdataservice.ac.uk/851377/
 
Title Money Supply and Finance 
Description Money Supply data for six main Southeast Asian countries during World War II 
Type Of Material Database/Collection of data 
Year Produced 2013 
Provided To Others? Yes  
Impact Used in Japan including by Japanese groups researching the war 
URL http://reshare.ukdataservice.ac.uk/851377/
 
Title National Product in World War II Southeast Asia 
Description GDP data for six main Southeast Asian countries during World War II 
Type Of Material Database/Collection of data 
Year Produced 2013 
Provided To Others? Yes  
Impact Response from researchers and academics who have made use of the data 
URL http://reshare.ukdataservice.ac.uk/851377/
 
Title Urban Southeast Asia 
Description Data on population in major Southeast Asian cities 1936-1954 
Type Of Material Database/Collection of data 
Year Produced 2013 
Provided To Others? Yes  
Impact Has helped to reverse prevailing view that main Southeast Asian cities lost population during the World War II Japanese occupation and demonstrated large population gains for a number of cities 
URL http://reshare.ukdataservice.ac.uk/851377/
 
Description Financing Shinobu 
Organisation Gakushuin University
Country Japan 
Sector Academic/University 
PI Contribution Writing concepts and analysis
Collaborator Contribution Expertise in Japanese language, data collection and discussion
Impact Journal articles and two forthcoming publications: Financing Japan's World War II Occupation of Southeast Asia"; "The Japanese occupation of World War II Southeast Asia"; forthcoming: "The Challenge of Finance in World War II Southeast Asia", with Shinobu Majima, War in History, 21, 3 (2015) and "Paying for War, 1941-1945: How Japan Financed Southeast Asia's Occupation", with Shinobu Majima, in Marcel Boldorf and Tetsuji Okazaki, eds. Economies under Occupation. The Hegemony of Nazi Germany and Imperial Japan in World War II (London: Routledge, forthcoming, 2015; eISBN 978-1-315-71627-5). Disciplines are economics, history and politics.
Start Year 2010
 
Description Urbanization Angeles 
Organisation University of Glasgow
Country United Kingdom 
Sector Academic/University 
PI Contribution Joint authorship of "Globalization, Industrialization and Urbanization in Pre-World War II Southeast Asia"
Collaborator Contribution Joint work on modelling and methodology
Impact Journal article in Explorations in Economic History: Globalization, Industrialization and Urbanization in Pre-World War II Southeast Asia. This project has drawn on economics, history, sociology and geography.
Start Year 2011
 
Description War Gillian 
Organisation University of Oxford
Country United Kingdom 
Sector Academic/University 
PI Contribution Writing and Research
Collaborator Contribution Writing and Research
Impact Every part of research output which forms part of this project has been discussed and worked on as part of this partnership. Disciplines involved are history, economics and geography.
 
Description "Financing Japan's World War II Occupation of Southeast Asia" 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Professional Practitioners
Results and Impact Seminar Presentations at University of Tokyo

Discussion and clarification of issues of financing war and central bank finance through money creation
Year(s) Of Engagement Activity 2011
 
Description "The Economics of World War II in Southeast Asia" 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Professional Practitioners
Results and Impact Seminar Presentation at School of Oriental and African Studies that led to many questions and extensive discussion

Discussion continued after seminar and led to considerable email correspondence
Year(s) Of Engagement Activity 2012
 
Description Asia Research Institute, Singapore: The Economics of World War II in Southeast Asia" 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Public/other audiences
Results and Impact Seminar Presentation to academic and public audience

Discussion and interchange with public as well as professional practitioners
Year(s) Of Engagement Activity 2013
 
Description School of Oriental and African Studies 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? Yes
Geographic Reach National
Primary Audience Professional Practitioners
Results and Impact Discussion and ideas contributed to changes in curriculum.

Impact on teaching programmes.
Year(s) Of Engagement Activity 2012,2013,2014
 
Description Singapore Ministry of Education 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? Yes
Geographic Reach International
Primary Audience Policymakers/politicians
Results and Impact Presentations and discussion helped to shape approach to university funding and research priorities of world-class research and relevance to Singapore.

Impact is in informing and helping to shape policymakers decisions as regard approach and funding.
Year(s) Of Engagement Activity 2012,2013,2014
 
Description Wasdea University, Tokyo 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Professional Practitioners
Results and Impact Seminar: "Singapore and the Second World War"

Stimulate interest and views of World War II in Southeast Asia
Year(s) Of Engagement Activity 2012
 
Description and South-East Asia Research Group, Foreign and Commonwealth Office 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? Yes
Geographic Reach International
Primary Audience Policymakers/politicians
Results and Impact Presentation and ideas sparked discussion.

Possible, but not certain, impact on UK policy in Southeast Asian region.
Year(s) Of Engagement Activity 2011,2012,2013