Finance, investment, and growth in Meiji-era Japan

This paper examines whether financial factors played a leading role in the rising investment rates and per capita incomes that characterized Japan ove r the 1880-1913 period. After an account of financial reforms undertaken du ring the Meiji transition (1868-1884) that created favorable conditions for successful finance-led development, a set of vector autoregressive models offers evidence that the financial sector was indeed instrumental in promot ing Japan's rise to world prominence by the eve of the First World War. (C) 1999 Elsevier Science B.V. All rights reserved.