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Reluctant Capitalists: Japanese Railways and Elite Investors in
the Late Nineteenth Century
Thomas Schalow University of Marketing and Distribution
Sciences, Kobe, Japan
[email protected] !!I. Statement of Purpose!!This paper examines
the way in which unanticipated changes in individual income
affected the investment motives and decisions of a special group of
investors - the former daimyo - and the development of private
railways in late 19th century Japan. It concludes that at least
some of these men were initially motivated by ideas of national
mission, but changes in the governments pension system eventually
caused considerations of profit and potential investment losses to
displace less selfish motives.!!II. Initial Daimyo Involvement with
Railroads!!A month after the government completed Japans first rail
line between Tokyo and Yokohama in September 1872, Hachisuka
Mochiaki, the former daimyo of Tokushima han, submitted a written
appeal urging all former daimyo to mobilize their family fortunes
and annual pensions in order to further railway development. Over
two years later, on 27 March 1875, a group of eleven prominent
(former) daimyo and their representatives met at the Peers Club to
consider action on Hachisukas proposal. !
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!The discussion at this first meeting centered around a plan to
create a railway that was eventually to link the city of Aomori in
northernmost Honshu with the capital in Tokyo. It was estimated
that at least ten years would be required to complete the project,
but the daimyo expressed their appreciation of the projects
importance to the nation. Although no firm decisions regarding the
funding or implementation of the groups yet rather vague objectives
were made at this first meeting, the group did agree to meet again
in the near future in order to formalize a course of action for
what was now known as the Tokyo Railway Association. !!The second
meeting of the group was held on 6 April at the home of Ikeda
Akimasa, the former daimyo of Okayama. It was at this meeting that
the important matter of finances began to be considered and the
daimyo formally committed themselves and their incomes to the
project. Although this group of eleven prominent daimyo believed
they would personally be unable to fund more than twenty-three
percent of the estimated 7.5 million yen in costs, it was agreed
they would continue to meet, plan, and hopefully attract other
members of the former ruling class to their venture. Hachisuka
Mochiaki, whose petition had originally prodded the group into
action, remained the most important investor, devoting seventy
thousand yen per year from his 19,317 koku income to the project.
!!
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The fourth meeting on 23 April brought the issue of the purpose
and direction, quite literally, of the group into question.
Takashima Kaemon, a businessman who had been placed in charge of
planning for construction, strongly believed the railway ought to
traverse the northeastern (Tohoku) region of Japans main island of
Honshu. His convictions were based on practical considerations as
well as ideological concerns for the nations development. He
pointed out that railway construction in the Tohoku region was
attractive because it presented few technological obstacles. The
area the line was to cover was fairly flat, with no major rivers or
mountains to plicate the actual construction work. Moreover, a
railway spanning the Tohoku would serve to advance commerce and
protect the country from the Russian threat to north. !!Takashima
further justified this northern route by asserting it would serve
to unify the embryonic Meiji state, which was yet almost as much a
confederation of feudal territories as it was a modern, centralized
state. At the time, claimed Takashima, the people of Japan were so
different in their many customs and languages as to be like
foreigners within their own country. A railway through the heart of
the former Tokugawa stronghold to the north would reduce the
tensions caused by these differences. !!Although no one doubted the
validity of Takashimas arguments there were doubts the daimyo were
capable of
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making the sacrifices necessary to complete the railroad. One
person to raise such doubts was Inoue Kaoru, who attended the
fourth meeting at the invitation of the groups financial advisor,
Shibusawa Eiichi. In a convincing speech Inoue declared that the
government, not the daimyo, ought to bear the burden of railway
construction. The risks were too high for a private firm and the
chances for immediately profit on a line to Aomori were minimal.
Moreover, the group had greatly underestimated the costs necessary
to complete the project. Inoue asserted that even ten million yen
might be insufficient to meet unforeseen problems, and the daimyo
had yet to guarantee even the planned 7.5 million yen. !!Takashima
had also, claimed Inoue, minimized the technological problems
involved in a Tohoku line, particularly in regard to the bridge
that would need to be constructed over the Tone River, in modern
Ibaraki prefecture. Under these circumstances he advised the daimyo
to abandon civic responsibility for profits and negotiate with the
government to acquire an existing railway. He suggested the
government might be willing to sell the profitable Tokyo-Yokohama
railway if the daimyo were interested. !!By the end of the fourth
meeting Inoues ideas had won the support of the daimyo investor
group. Therefore, at the next meeting Shibusawa submitted his
proposal to Dajo daijin Sanjo Sanetomi on 8 May 1875. He suggested
the
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railway be sold for no more than three million yen, and payments
be allowed over a seven year period. Negotiations with the
government were carried out over the next year, during which time
various points pertaining to the method of payment were debated. A
contract was finally achieved on 5 August 1876. The contract
between the government and the daimyo investment group established
a sinking fund into which the group members were required to pay
428,000 yen per year for the next six and one-half years. Payments
were to be made biannually until June of 1882, and the government
was to pay the group six percent annual interest on this money
until the daimyo assumed control over the railway. The government
was also to be responsible for running and maintaining the railroad
until the final payment had been made. After that time the daimyo
would gain title to the railroad and would be responsible for its
operations. No guarantees of profitability were provided by the
government but the members of the Tokyo Railway Association had no
reason to assume they would be unable to achieve anything but a
handsome return on their investment. !!As we have already seen, the
project initially proposed by Takashima fell far short of the
financial support needed to bring it to a successful conclusion.
Inoues promises of profit on the Tokyo-Yokohama line, on the other
hand, managed to raise the level of interest in railway investment
and elicited promises of monetary contributions from eight more
daimyo. After Inoues speech in the Peers Club the
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men involved with the Tokyo Railway Association had firmly
committed themselves to total annual contributions of 353,000 yen
over a ten year period. The terms finally agreed to by the
government for the sale of the Tokyo-Yokohama railway, however,
required them to meet 428,000 yen in annual payments over a six and
one-half year period. The difference between the two payment
periods, and thus the annual financial responsibility, was not
small, but after some difficult negotiations a few prominent
investors agreed to raise the level of their contributions to meet
the governments terms. !!Even the almost certain prospect of
profits, however, could not guarantee the project would never lack
for cash. Hachisuka Mochiaki remained the largest investor and his
777,000 yen contribution was critical for the success of the
venture. Unfortunately, his support, as well as that of his
partners in the railway venture, waned when the terms of the
governments pension commutation became public knowledge and incomes
were revised downward. In the next section we shall focus on the
way in which Hachisukas income was adversely affected by changes in
the governments pension scheme.!!III. The Kinroku Kosai &
Daimyo Funds!!The funds the daimyo had committed to their railway
project were not drawn from savings or accumulated wealth. Although
the daimyo had formerly controlled vast
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territories and claimed rights to the tax revenues of these
areas, following the Meiji Restoration their rights to this feudal
income and the wealth of their domains were gradually invalidated.
By the time they began to consider investment in the railway
venture their assets were reduced to the income collected from an
annual pension payment from the government. During the short
lifetime of the Tokyo Railway Association a number of changes to
the governments ensign system caused drastic reductions in annual
incomes and forced the group to reconsider investment motives and
commitments. The changes to that pension system are generally
referred to as the chitsuroku shobun, and occurred in three general
stages. !!The first stage, precipitated by the return of feudal
domains under hanseki hokan regulations, converted feudal tax
privileges to annual salaries. In regulations issued on 2 August
1869 the daimyo were ordered to allocate no more than ten percent
of domain revenue for their personal use. This amount became the
karoku of the daimyo. The income the daimyo received as a result of
this legislation ranged from Shichinoe daimyo Nanbu Nobutakas one
hundred and seventy koku to the 636,880 koku received by Maeda
Yoshiyasu of Kaga. Hachisuka Mochiaki, as daimyo of Tokushima,
received a sum of 19,317 koku on an annual basis. He also received
an additional award (shotenroku) for service in the Boshin Civil
War of 1868-69 of two thousand ryo. !!
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The second stage in the process of converting feudal privileges
to annual income substituted cash payments for allotments of rice.
The cash payments were known as kinroku amounts, and were dispensed
according to legislation of 7 September 1875. The governments cash
payment system was based on a simple formula that multiplied the
original stipend of the recipient by the average local rice price,
computed over the preceding three years. Rice prices varied
greatly, from less than 3 yen per koku in certain Tohoku domains,
to over six yen per koku in various parts of the Kanto. This meant
that two daimyo whose tax incomes in the Tokugawa period, expressed
in koku of rice, were rather similar might now have found their
cash incomes quite different due to regional rice price variations.
!!The rather high rice prices common to Tokushima worked in
Hachisukas favor when calculating the cash payment he was to
receive by the terms of the September 1875 legislation. The
established Tokushima pice of 5.27 yen per koku was on the upper
end of the price scale, and Hachisukas income was thereby set at
slightly over one hundred thousand yen per year. Even based on this
favorable figure, however, it was clear the 770,000 yen Hachisuka
had promised to contribute to the railway project over a six and
one-half year period exceeded his total income for the same period
by approximately one hundred thousand yen. !!
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The final stage in the process of adjusting pensions to
accommodate the governments fiscal difficulties converted cash
payments into bond obligations, and caused further deterioration in
Hachisukas own financial position. The new legislation went into
effect on 5 August 1876, once again using a simple formula that
multiplied the cash stiped by a stipulated, fixed number of years.
By the new legislation Hachisukas cash payment was converted to
five hundred thousand yen, face value, in bonds, known as kinroku
kosai, paying five percent interest per annum. Interest payments on
the bonds would amount to only 250,000 yen per year, and an attempt
to sell the bonds at the discounted prices that prevailed on the
financial markets at the time might have cut Hachisukas one-time
gain from the government pension scheme to less than 350,000 yen.
Given these facts, one can begin to understand the difficulty
Hachisuka and the other daimyo believed they would experience in
meeting planned investment commitments. !!Of course, the sum
Hachisuka obtained from the Meiji government in return for his
feudal rights as daimyo of Tokushima was not insubstantial. In the
mid 1870s even the Dajo daijin commanded a salary no higher than
800 yen per year. Moreover, it is important to remember that the
bonds could truly be called a git from the Meiji government, as it
was not compelled to honor the obligations inherited from the
Tokugawa regime. Once feudal rights to tax collection had been
converted into
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salaries paid to daimyo in their new capacity as domain
governors. One can perhaps better understand the sense of mission
perceived by the daimyo after these considerations. !!Nonetheless,
when the extent of the burden to which Hachisuka and the other
daimyo had committed themselves to became apparent it also became
obvious to most members of the Tokyo Railway Association that they
would need to reduce financial commitments to the railway venture.
There may have been a place for a sense of mission when that
mission could be funded by money provided by someone else as a
gift. It was more difficult to commit ones self to a mission that
might need to be financed by borrowed money.!!IV. Faltering Daimyo
Support for Railways!!The issue of finances dominated the tenth
meeting of the daimyo investment group the month after the
September 1875 pension reform was announced. It was clear the
daimyo had been overly optimistic in their assessment of the groups
financial power, and unless other persons could be brought into the
group it was clearly overextended. An impending crisis was
momentarily averted, however, when Shibusawa offered the group
financial assistance from his own 1st National Bank in order to
meet the governments required payment schedule. To the extent that
the daimyo adversely affected
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by the pension reform were unable to make payments, he would
advance the necessary capital with a mere ten percent interest
charge. (The daimyo, it will be remembered, received only six
percent interest from the government on these payments, resulting
in a net loss for them but a tidy business for Shibusawa.) !!Most
daimyo were momentarily reassured by Shibusawas commitment to the
project and his willingness to loan necessary funds to the group.
The 1st National bank was thereupon placed in charge of collecting
all payments and holding the interest paid by the government for
the sinking fund. It assumed the role of lead bank for the Tokyo
Railway Association and seemed prepared to guarantee the success of
the groups venture. !!Unfortunately, the last phase of the pension
reforms made an already bad situation even worse. The daimyo slowly
began to realize they were not only in danger of losing the
financial gift the Meiji government had originally offered to them,
they were also in danger of becoming personally responsible for the
repayment of the ever-larger loans needed to keep the Tokyo Railway
Association in operation. The business meetings of the group began
to be dominated by expressions of concern, if not actual fear, for
the financial difficulties of individual members. When Yamanouchi
toyonori indicated he might be able to make his first semi-annual
payment for 1876, but would have difficulty meeting the second
payment, he was certainly
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expressing a sentiment that was already troubling most other
members of the group. !!It can therefore be said that changes in
the governments pension scheme were a key factor in dimming
whatever enthusiasm the daimyo investment group may have once had
for the railway project. Date Munenari spoke for the group when he
expressed the opinion that the pension changes had made it
virtually impossible to continue planning, and it was thus
imperative the government be asked to revoke the contract and
return money already paid into the sinking fund. The members of the
Tokyo Railway Association continued to meet until 18 March 1878,
but there was little discussion of national mission and the railway
project at the latter meetings. By the time of the groups demise
after the fortieth business meeting considerations of potential
investment losses can truly be said to have displaced concerns for
national welfare.!!V. A Final Attempt & Failure!!The daimyo
were to make one more attempt, as an elite group, to promote
railway construction before they decided to devote themselves
wholeheartedly to the democratic enterprise known as the Japan
Railway Company. In August 1881 another group of daimyo submitted a
petition to the Tokyo municipal authorities seeking permission to
form the Tohoku Railway Company. This group planned to lay railway
lines from Yanagase (in
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Shiga prefecture) to Toyama and from Nagahama (also in Shiga) to
Ise. All those involved with the project had personal interests in
the area under development, usually due to the fact that they had
previously served as daimyo or chili (governor) for a portion of
the area. The company was to be initially capitalized at 4.5
million yen, with contributions from the Maeda, Doi, Ogasawara,
Arima, Manabe, and Matsudaira (of Echizen han) families. !!This
venture, however, like the Tokyo Railway Association, was ale
undercapitalized and subject to adverse government interference.
The noble plans of the Tohoku Railway Company came to naught when
the government forced it to change one of its lines, eliminating
the Fukui portion of the track. The affected daimyo indicated they
would not fund a railway that did not traverse the territory of
their former domains, and withdrew their monetary support. In July
1884 the group chose to disband after having failed to either
attract new capital or agree on a method to reallocate previous
commitments.!!VI. The Daimyo as Investors!!Although the Meiji
government certainly did not make it easy for the daimyo to plan
their investments, or implement those plans, I believe the failure
of groups such as the Tokyo Railway Association and Tohoku Railway
Company was as much a result of the character of the daimyo as
investors as it was of government interference.
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if we were to attempt to classify our group of daimyo investors
we might place them in Marilyn MacGruder Barnewells passive
investor group. According to the Barnewell Two-Way Model, passive
investors are defined as those investors who have become wealthy
passively - for example, by inheritance. !!Although the daimyo had
received their wealth from the Meiji government, rather than from
their forefathers, they were in many ways similar to inheritors.
Ronald Kaiser noter that those who have inherited money, or
received it as a gift, often exhibit a tendency toward low self
esteem, which can exhibit itself in a fear of failure and lack of
motivation. Fear of failure can cause the inheritor to be
indecisive, feeling that no decision or action is better than
making a mistake. Moreover, Inheritors can be very risk adverse
because, not having earned the wealth themselves, they may be very
fearful about what they would do without it. !!The fear felt by the
daimyo resulted from the fact that changes in the government
pension system had made it difficult to anticipate future income
flow. We have already seen the way in which the September 1875
reform degraded income expectations, and how the August 1876 reform
further reduced those incomes. The daimyo were certainly wise to
re-evaluate their ability to undertake substantial investment
projects in the face of such uncertainty. !
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!Yet, in the final analysis, we must ascribe the failure of the
investment groups to a lack of will, an extreme adversity to risk.
After all, no investor enjoys the luxury of planning in an
environment in which there are no risks or uncertainty concerning
the future. No individual is able to project future income flow, or
probable expenses, with any degree of certainty. The daimyo at leas
enjoyed the advantage of knowing their government bonds were likely
to continue yielding a 5% interest payment, and thus a rather
stable income. Moreover, the difficult problems of capital
inadequacy experienced by both the Tokyo Railway Association and
Tohoku Railway Company could have been met by asking other daimyo
to join the investment groups. The amount of government bonds (over
thirty million yen) given to members to the former ruling class as
a result of the pension reforms was not small, and even at the deep
discounts that prevailed on the financial markets of the time the
total of those bonds was more than sufficient to capitalize both
the projects we have looked at. !!As passive investors the daimyo
were also, to use the terminology of the Bailard, Biehl &
Kaiser Five-Way Model, guardians. The daimyo were simply people who
were cautiously trying to preserve their wealth, rather than
increase it. They were basically satisfied with what they had, and
believed investments were potentially more dangerous than
profitable. Again, it was better to do
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nothing than to accept the uncertain opportunity to gain (or
lose) more. !!There was probably little that could be done to
change the basic character of the daimyo as investors. They were
extremely cautious and not comfortable with the risk that would be
undertaken if it were necessary to actually borrow money top
finance the railway projects we have spoken of. This does not mean,
however, that they were incapable of making contributions to the
economic development of the nation. In fact, as the wealthiest
group of potential capitalists it was impossible to merely accept
their risk-adverse nature and plan investment projects without
them. The solution to the problem of how to satisfy the need for
security felt by the daimyo, while at the same time promoting the
development of an important transportation infrastructure, was
simply to enlarge the investment groups. !!The amount of individual
financial risk on a given project declines in proportion to the
number of people committed to that project. A ten million yen
project, as originally conceived by the daimyo when planning the
Tokyo-Aomori railway, might present unacceptable risk and financial
responsibility for a group of eleven men. A group of five hundred
persons, however, might find the level of risk and financial
responsibility for that same ten million yen project to be quite
reasonable, even if these persons were all, basically, extremely
cautious investors. The chances for
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the projects success would, moreover, be enhanced considerably
by accepting investments from a diverse group of individuals,
rather than from a uniform group os guardians or passive investors.
!!The objectives of preserving the wealth of the daimyo and
advancing the development of railways were, quite fortunately,
goals which many important members of the government were committed
to. The most outspoken and energetic advocate for these two causes
was perhaps Iwakura Tomomi, who assisted in the planning for the
next railway venture we will consider.!!VII. Success & Its
Conditions: The Lessons of Failure!!By 1880 new plans were under
consideration that would allow the daimyo to achieve their
professed desire to contribute to railway development. When a group
of forty-six men led by Ikeda Akimasa submitted a petition in May
of 1881 to forma company with capital subscribed to by both daimyo
and the provincial elite they found the government extremely
receptive to the planned project. !!One reason for renewed
government interest in railway development was that Japan had once
again experienced a surge in imports in the late 1870s, leading to
a dramatic decline in foreign currency reserves. A railway to link
producers in the Tohoku region with Yokihama merchants, thus
encouraging exports, was seen as a necessary first
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step toward the solution of this problem. The railway, which was
also expected to improve the living standards of the farmers close
to the line, might additionally help the blunt the political
opposition, expressed through the jiyu-minken movement, that had
become such a problem. !!The Kobusho, which was to oversee
construction on the new railway, granted its approval for the
project in November and blessed the group with a number of special
privileges, about which we will be speaking momentarily. Out of
gratitude, and to guarantee the government would continue tits
support for the project, the group elected Yoshii Tomozane of the
Kobusho as its first president at the stockholders meeting held the
following month. !!The new venture known as the Japan Railway
Company, unlike the Tokyo Railway Association, was authorized to
sell stock to anyone who wished to purchase that stock, regardless
of social standing. It was expected that the former daimyo would
make a major contribution, and Iwakura devoted much time to meeting
with these men to assure this, but it was realized that the company
would be successful only if it were able to mobilize the funds of
daimyo, samurai, farmer, craftsmen, and merchant - rich and poor
alike. !!The twenty million yen of stock offered to the public was
to be the largest public offering since two million yen of Yokohama
Specie Bank stock was sold in 1879, and the
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venture was therefore undertaken with more than a little
trepidation. Finance Minister Matsukata Masayoshi suggested the
initial stock issue might meet with more success if the government
offered profit subsidies for the company, and he arranged for money
from postal revenues to be diverted for this purpose. !!Profit
subsidies guaranteed an eight percent operating profit for each
section of track for a fixed number of years after it was
completed. The entire Tokyo-Aomori line was not completed until
September 1891 but individual set ions were opened for business
earlier. Although there were five distinct set ions of track
(section one was from Tokyo to Maebashi, section two from Omiya to
Shirakawa, section three from Shirakawa to Sendai, section four
from Sendai to Morioka, and section five form Morioka to Aomori)
the government agreed to a general ten year guarantee on profits
for the Tokyo-Sendai line and a fifteen year quarantee of the
Sendai-Aomori line. profit subsidies were thus due to expire on the
final portion of the track in 1906. !!The line from Tokyo to
Maebashi proved to be highly profitable as soon as the track was
completed and it needed and received no government subsidies.
Section two managed to show a profit within a few years after
completion of the line and received no subsidies after 1887.
Section three required a longer period of time to begin to show a
profit, but it was also able to end government subsidies by 1894.
Section four, however,
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was not able to sustain profits at the eight percent level until
the time of the Russo-Japanese War, and section five was never
weaned from profit subsidies. !!Even with tax breaks and profit
subsidies the success of the companys first public stock offering
in March 1881 could not be assured. As feared, the response from
the public was less than enthusiastic. it had initially been hoped
the company would be able to raise twenty million yen (the proposed
capitalization) in the initial subscription and that the entire
amount could be paid in within two years. However, the amount of
stock actually subscribed to in the initial offering was less than
one-third of the twenty million yen total. !!A total of five
hundred and sixteen persons pledged to purchase at least five
thousand yen of stock when the company applied for permission to
incorporate in 1881. Only seventy-one of these persons were members
of the former feudal ruling class, but they contributed forty-five
percent of the 5.72 million yen total achieved by the initial
public offering. The fact that almost half of the companys initial
capital was derived from the former daimyo and court aristocracy
shows that this group was prepared to assume a major role in
railway development if risks could be minimized. The daimyo were
passive and extremely risk-adverse, but with proper direction and
supervision provided by the government they could be mobilized to
action. !
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!Fortunately, by January 1884 the company was able to offer its
first dividend, thanks in part to the subsidies provided by the
government, and this pushed up prices and demand for the stock on
the Tokyo stock exchange. This development made another stock
offering possible in 1885, which nearly doubled the capital
available to the company. Stock was tendered to the public again
every other year from 1888 to 1896 and a final, eighth offering was
made in 1897. By 1905 the capital of the company exceeded fifty
million yen. Daimyo investments continued to provide a major source
of capital during this time. !!With the government guarantee of
profits investment in railway construction proved to be a safe and
sound investment for the daimyo for almost two decades following
the establishment of the Japan Railway Company. By the end of the
nineteenth century, however, new developments in the railway
industry made investing less attractive than it had once been. The
reason for the declining daimyo interest in railways may be found
in the profit statements of the Japan Railway Company. By the end
of the nineteenth century the railways had quite simply ceased to
be a good investment, even with the profit subsidies provided by
the government. In 1898 the dividend ratio on Japan Railway stock
fell from a fairly constant ten percent rate to a mere 5.5 percent.
The fall in the dividend rate precipitated a sharp decline in the
price of the stock from a high of 125.5 yen per share in 1896
to
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a low of 59.5 in 1898. Many people began to fear that the
Japanese railroads were destined to follow the path of the English
railway system into declining profits and stock prices. The daimyo
were once again faced with the choice of continuing to invest in
railways, perhaps at the risk of loss of investment capital, or
reverting to character and accepting their role as guardian of
wealth. it should surprise no one that they chose the latter course
of action.!!VIII. Conclusions!!Although the daimyo may not have
lacked a certain sense of mission, the history surrounding their
investment in railways indicates they were primarily concerned with
loss of capital, and only secondarily with either personal or
national profit. It was much more important for these people to
preserve what they had been given than to enhance their wealth or
prestige. They were, to return to the distinction provided by
Shibusawa Eiichi and mentioned in the first footnote of this paper,
shonin rather than jitsugyoka. Their concern, as merchants, for
more trivial matters of profit and loss made it difficult for them
to act as entrepreneurs, concerned for the economic and
technological advancement of society. As such, they proved
ineffective in small groups, though the aggregate of their wealth
was an extremely important factor in the development of Japans
railway infrastructure.!!
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1)See Hirschmeier, Johannes. The Or ig ins of Entrepreneurship
in Meiji Japan. Cambridge: Harvard University Press, 1964, page 209
for discussion of the concept of national mission versus profits,
and the distinction between what Shibusawa Eiichi referred to as
the shonin and jitsugyoka types of investors.!
!2) Iwakura ko kyuseki hozonkai. Iwakura ko jikki. Tokyo,
1927, volume 3, page 480-482. (Hereafter this source, volume 3,
will be referred to as Iwakura.)!
!3)Shibusawa Shoen kinen zaidan tatsumonsha.
Shibusawa Eiichi denki shiryo. Tokyo: Shibusawa iichi denki
shiryo kankokai, 1956, volume 8, page 359. (Hereafter this source,
volume 8, will be referred to as Shibusawa.)!
!4)Hachisukas 19,317 koku of r ice was worth
approximately 140,000 yen at the prevailing price of 7.28
yen/koku of rice. See Kajinishi Mitsuhaya, ed. Nihon ni okeru
shihonshugi no hattatsu-nenpyo. Tokyo: Tokyo daigaku shuppankai,
1953, page 14.!
!5)Shibusawa, page 371.!!6)Okubo Toshiaki, ed. Kazoku kaikanshi.
Tokyo:
Yoshikawa kobunkan, 1986, volume 1, pahge 58, 16 July 1874.!
!
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7)Shibusawa, page 373.!!8)Shibusawa, pages 378-384.!!9)Naikaku
kanpokyoku. Horei zensho. Tokyo: Hara shobo,
1975, volume 2, pages 237-238. (Hereafter this source will be
referred to as Horei zensho.)!
!10)Ouchi Hyoe, ed. Meiji zenki zaisei keizai shiryo shusei.
Tokyo: Kaizosha, 1933, volume 8, pages 449-461. (Herefter this
source, volume 8, will be referred to as Meiji zenki zaisei.)!
!11)Meiji zenki zaisei, page 450.!!12)Okubo Toshiaki, ed. Kazoku
seido shiryoshu. Tokyo:
Yoshikawa kobunkan, 1985, page 42.!!13)Horei zensho, volume 8,
page 171.!!14)Meiji zenki zaisei, pages 480-489.!!15)Horei zensho,
volume 9, pages 147-151.!!16)Meiji zenki zaisei, page 405. In
Hachisukas case this
was five years, thus yielding slightly over five hundred
thousand yen in bonds.!
-
17)Jones, hazel L. Live Machines: Hired Foreigners and Meiji
Japan. Vancouver: University of british Columbia Press, 1980, page
11.!
!18)Shibusawa, pages 403 and 452.!!19)Shibusawa, page
476.!!20)Shibusawa, page 534.!!21)Noda Masaho. Meijiki ni okeru
shiyu tetsudo no
hattatsu to kabushiki hakko shijo no tenkai, Keizai shirin 32
(January 1964), pages 127-128.!
!22)Kaiser, Ronald W. Individual Investors, in Managing
Investment Portfolios: A Dynamic Process. 2nd edition. John L.
Maginn and Donald L. Tuttle, eds. Boston: Warren, Gorham &
Lamont, 1990, section 3-6. (Hereafter this source will be referred
to as Managing Investment.)!
!23)Managing Investment, section 3-15.!!24)Managing Investment,
section 3-10.!!25)Iwakura, page 782.!!26)Iwakura, page 797.!!
-
27)Noda, Keizai shirin, page 124. Government subsidies were
common on railway projects throughout the world. See Macpherson,
W.J. Investment in Indian Railways, 1845-1875, Economic History
Review 8 (1955), 177-186 for a succinct discussion of the need for
subsidies.!
!28)Hoshino Takao. Nihon tetsudo kaisha to dai jugo
kokuritsu ginko, Musashi daigaku ronshu 19 (March 1972), pages
124-125. The Tokyo-Maebashi section of track was through Omiya, and
branched off to Shirawaka from Omiya for the second section.!
!29)The total amount of stock sold as a result of this
initial
offering was 119,314 shares, which provided 5,965,700 yen of
capital at fifty yen per share. See Nihon tetsudo kabushiki kaisha.
Meiji 38 nen-nenpyo. Tokyo, 1906, pages 3-4. (Hereafter this source
will be known as Meiji 38 nen.)!
!30)The stock of the Japan Railway Company was,
incidentally, first traded on the Tokyo stock exchange on 24
April 1884. The primary focus of Nodas article in Keizai shirin is
to show how the stock market gradually changed from a market for
government bonds to one dealing in stocks - primarily railway
stocks.!
!31)Meiji 38 nen, pages 3-4.!
-
32) Hoshino. Musashi daigaku ronshu 19 (August 1971), page
19.!
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