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Agricultural Growth against a Land Resource Constraint: A Comparative History of Japan, Taiwan, Korea, and the Philippines

Published online by Cambridge University Press:  11 May 2010

Masao Kikuchi  and
Yujiro Hayami
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Abstract

A common element revealed by comparative history of four Asian countries is a major shift in the momentum of agricultural growth from an extension of cultivation frontiers to an agricultural system that uses land more intensively. Improvements in land infrastructure, such as irrigation and drainage, are identified as preconditions for the development of land-saving farming technology. Public investments in land infrastructure were induced by the higher rates of return to irrigation construction and improvements than to new land opening.

Type
Articles
Information
The Journal of Economic History , Volume 38 , Issue 4 , December 1978 , pp. 839 - 864
Copyright
Copyright © The Economic History Association 1978

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References

1 Schultz, Theodore W., The Economic Organization of Agriculture (New York, 1953), pp. 125–45.Google Scholar

2 Boserup, Ester, The Conditions of Agricultural Growth: The Economics of Agrarian Change Under Population Pressure (Chicago, 1965)Google Scholar; and Clark, Colin and Haswell, Margaret, The Economics of Subsistence Agriculture (London, 1964).Google Scholar

3 Hayami, Yujiro and Ruttan, Vernon W., Agricultural Development: An International Perspective (Baltimore and London, 1971).Google Scholar

4 North, Douglass C., and Thomas, Robert Paul, The Rise of the Western World: A New Economic History (Cambridge, 1973).CrossRefGoogle Scholar

5 See Ohkawa, Kazushi and Rosovsky, Henry, “The Role of Agriculture in Modern Japanese Economic Development,” Economic Development and Cultural Change, 9 (1960), 43–47CrossRefGoogle Scholar; Johnston, Bruce, “Agriculture and Economic Development: The Relevance of Japanese Experience,” Food Research Institute Studies, 6 (1966), 251–312Google Scholar; and Hayami, Yujiro, in association with Masakatsu Akino, Masahiko Shintani and Saburo Yamada, A Century of Agricultural Growth in Japan: Its Relevance to Asian Development (Tokyo, 1975).Google Scholar

6 The beginning years for the periods of comparison for Japan, Taiwan, and Korea roughly correspond to the completion of the cadastral surveys which laid a foundation for modern agricultural development.

7 Only male workers were counted in the agricultural labor force, primarily for the sake of international data comparability. This eonvention follows the tradition of Clark, Colin, The Conditions of Economic Progress (1st ed.; London, 1940).Google Scholar

8 It appears that population pressure on land in Taiwan was much lower in the nineteenth century, and the land/man ratio was on a level comparable to the Philippines today. See Lee, T. H., Intersectorcd Capital Flows in the Economic Development of Taiwan, 1895–1960 (Ithaca, 1971).Google Scholar

9 Hayami and associates, A Century of Agricultural Growth, pp. 170–79.

10 Hayami and Ruttan, Agricultural Development, p. 208.

11 Crisostomo, Cristina M., Meyers, Richard H., Paris, Tirso M., Duff, Bart, and Barker, Randolph, “The New Rice Technology and Labor Absorption in Philippine Agriculture,” Malayan Economic Review, 16 (1971), 117–58.Google Scholar

12 For more details about the history of land infrastructure development, see Chosakai, Nogyo Hattatsushi, Nihon Nogyo Hattatsushi (History of Japanese agricultural development), Vol. 4 (Tokyo, 1954), pp. 117–320Google Scholar; and Hayami and associates, A Century of Agricultural Crowth, pp. 170–92.

13 For more details, see Hayami and Ruttan, Agricultural Development, pp. 205–07; and Kawano, Shigeto, Taiwan Beikoku Keizai Ron (Treatise on rice economy of Taiwan) (Tokyo, 1941).Google Scholar

14 For more details, see Hayami and Ruttan, Agricultural Development, pp. 207–10; and Kobayakawa, Kuro, ed., Chosen Nogyo Hattatsushi (History of Korean agricultural development) (Tokyo, 1959).Google Scholar

15 Hooley, Richard and Ruttan, Vernon W., “The Philippines,” in Agricultural Development in Asia, Shand, Richard L., ed. (London, 1969), pp. 215–50.Google Scholar

16 The basic idea was originally developed in Hayami, Yujiro, David, Cristina C., Flores, Piedad, and Kikuchi, Masao, “Agricultural Growth Against a Land Resource Constraint: The Philippine Experience,” Australian Journal of Agricultural Economics, 20 (1976), 144–59.CrossRefGoogle Scholar

17 Curve A would also be affected by the biological and chemical innovations to some extent. But their impacts on Curve I would be much larger because of the strong complementarity between irrigation and seed-fertilizer response functions.

18 The aggregate time series data of capital costs for irrigation development and land opening are compiled from various sources for each country. The major irrigation projects covered and the pertinent data sources are: (a) for Japan, the land improvement projects approved by the Arable Land Replotment Law, the data from the Ministry of Agriculture and Forestry, Dai 16-ji Kochi Kakucho Kairyo Jigyo Yoran (16th report on arable land expansion and improvement projects) (Tokyo, 1941)Google Scholar; for Taiwan, the irrigation projects undertaken by the Government-General, the data from the Bank of Taiwan, Taiwan Shui Li Wenn Tyi (Irrigation problems in Taiwan) (Taipei, 1950)Google Scholar; (c) for Korea, the irrigation projects under the Korean Rice Production Development Program, the data from the Korean Government-General, Chosen Tochikairyo Jigyo Yoran (Summary of land improvement projects in Korea) (Seoul, 1940)Google Scholar; (d) for the Philippines, the national gravity irrigation systems, the data from National Irrigation Administration, Revised Listing of National Irrigation Systems Operated and Maintained by the National Irrigation Administration, as of June 30, 1974 (Quezon City, 1974)Google Scholar. The major land opening projects covered and their data sources are: (a) for Japan, the projects approved by the Arable Land Reclamation Assistance Law, the data from the Ministry of Agriculture and Forestry, 16th Report; (b) for Taiwan, the government land settlement projects in Hualien province, the data from the Taiwan Government-General, Kanei Iminjigyo Hokokusho (Report on government land settlement projects) (Taipei, 1919)Google Scholar; (c) for Korea, the land reclamation projects under the Korean Rice Production Development Program, the data from the Korean Government-General, Summary of Land Improvement Projects; (d) for the Philippines, the land resettlement projects of the Bureau of Land Resettlement, the data from the Bureau of Land Resettlement (unpubl.).

The operation and maintenance costs for irrigation are assumed: 3% of initial capital costs for Japan; 18 yen per hectare for Taiwan; 13 yen per hectare for Korea; and 60 pesos per hectare for the Philippines. The O-M costs for land opening are assumed as zero for all countries except for Korea, for which the same amount of O-M costs as for irrigation is assumed because all land opening projects included in our analysis had irrigation facilities. The median years of the capital construction periods are assumed as 2, 1.5, 1.5, and 1.5 years in the case of irrigation, and 2.5, 2.5, 4.5 and 1.5 years in the case of land opening, for Japan, Taiwan, Korea, and the Philippines, respectively. The periods of usable life are assumed as 50 years for all countries for the irrigation case, and infinite for the land opening case, except for Korea for which it is assumed as 50 years.

19 Increases in labor costs, for crop production due to irrigation and land opening were not subtracted. This is to assume that the increments in labor are available at zero opportunity cost. In fact, there is little change in labor input for the wet season crop due to irrigation. Labor use in the dry season (for Taiwan and the Philippines) increases as irrigation enables planting in the dry season. It seems reasonable, however, to assume that during the dry season farm labor, which remains primarily idle if there is no irrigation, has a very low opportunity cost. Also, it seems reasonable to assume that the workers who are resettled by the government land opening projects (for which our C/B calculations were made) are those who had difficulty in finding productive employment in their prior locations.

20 The deflators used are: for Japan, the price index of land infrastructure construction from the National Research Institute of Agricultural Economics, Tochi Kairyo Toshi no Suikei (Estimates of land improvement investments) (Tokyo, 1967)Google Scholar; for Taiwan and Korea, the GNE implicit deflator for investments in construction from Mizoguchi, Toshiyuki, Taiwan Chosen no Keizai Seicho (Economic growth in Taiwan and Korea) (Tokyo, 1975)Google Scholar; and for the Philippines, the GNP implicit deflator for investments in construction from the National Economic Development Authority, National Income Accounts (Quezon City, 1973).Google Scholar

21 For the details of C/B calculations, see Kikuchi, “Irrigation and Rice Technology.”

22 The selection of the fertilizer application levels was based on both actual farm survey data and optimum levels derived from the fertilizer response functions. See ibid.

23 In fact, in an earlier stage of development in Taiwan, several land settlement projects were undertaken by the colonial government and the sugar companies. But those projects resulted in miserable failure. Taiwan Government-General, Report on Government Land Settlement Projects; and Yanaihara, Tado, Teikokushugi ka no Taiwan (Taiwan under imperialism) (Tokyo, 1929)Google Scholar. Almost the only project that was successful in settling the emigrants was. the project analyzed here, and even this was terminated in 1917, leaving incomplete a large part of the original plan. Such unsuccessful attempts correspond well to the low rates of returns to land opening estimated in this study.