Role Of Agriculture In Economic Development: A Case Study Of Japan

The Agricultural Sector and Economic Development

Question:

Discuss about the Overview of Agricultural Sector.

The agricultural sector is an inevitable part of the economy that contributes towards the overall development of the country. As argued by Nakamura and James (2015), agriculture has already contributed effectively towards the economic prosperity of different advanced countries. The role of agriculture in employment opportunity creation and economic development of the underdeveloped countries is also undeniable. However, a group of researchers have always argued that though agriculture plays a crucial role in the economic and sociological development of the developed as well as underdeveloped countries, the policy frameworks do not focus much on agriculture. This assignment will emphasise over the fact that most of the time agriculture remains neglected in the development policies while it can play a crucial role through providing food security and creating employment opportunity (Bassino et al 2017). In order to substantiate the aforesaid statement primarily a conceptual overview of the agricultural sector along with its evolution in the context of Japan will be discussed. Later on the contribution of agriculture towards the societal and economic developments of Japan will also be emphasized.

In Japan, agriculture has always played a major role in the country specific culture and traditions since ages. Presently, Japan has turned into a gigantic economy and market its presence as the second largest economy in the world. Highest standard of living which is supported by the continuous and sustained growth of the manufacturing, export and technology (Saito, Osamu, and Masanori Takashima 2016). Nowadays, the role of agriculture has been observed to be reducing by a few percent compared to the total. The growth rate of the agriculture is also lagging behind that of the radical growth rates of the other sectors. However, it can be stated that agriculture in Japan bears a cultural significance as most of the people are now urban and only remain connected to farming, rural life and agriculture for a generation or two.

As of now, efforts have been put forwards to protect and secure the traditional agriculture of Japan. However, these efforts gave rise to mixed results meaning it has not affected the specific sector either positively or negatively. Japan as a country has obtained the lion’s share of its wealth from trading and by exploiting the opportunities of comparative advantage, higher rate of tariff that protects some of the agricultural products can be considered as an exception. The efforts put forward to reserve the resources like land and agricultural labour despite the draw from the various other portions of the economy have helped to maintain the level of domestic production (Lockwood, William Wirt 2015). However, these efforts have also been held responsible for distorted markets, giving rise to unexpected outcomes such as land abandonment, overproduction and speculation. Preserving the production of rice ensures the loss of opportunities for other products, for instance the products like fruit, vegetables, specialty meat which in turn can be profitable in a country where land is a scarce factor of production.

Agriculture in Japan: A Cultural and Sociological Overview

As per the statistics provided by the Ministry of Agriculture, forestry and Fisheries during the year 2014, the total agricultural, fisheries and forestry production of japan was JPY 8.36 trillion which was equivalent to USD 81 billion. This level of production was below the historical peak value JPY 11.72 trillion which was attained in 1984 (Schandl et al 2016). On a summative note it can be stated that the most important categories in this specific sector where livestock which contributed 35.5% in the total production value as well as vegetables and rice which accounted for 26.6% and 17.1% respectively in the total production value.

The role of agriculture in enhancing the economic development and afterwards identifying the methods through which this specific role can be enhanced has been the key issue of discussion in development economics. In other words the countries which are willing to industrialise agriculture is the most common source of resources to them which can be used for serving the investment purposes in the emerging sectors. As it has been stated earlier that agriculture in Japan is amalgamated within its sociological and cultural framework. However, agriculture acts as the cornerstone of any economy it provides the basic requirements and now it also supplies raw materials required for industrialization.

The agricultural sector of Japan contributed significantly in fostering its economic prosperity. It is also quite evident that Japan one of the leading industrialized economy of the world was once agriculture based. However, presently the contribution of agriculture in the GDP of Japan is depicting a lowering trend. In 2016, agriculture’s share was 1.07% of GDP (Reganold and Jonathan 2016).

Agriculture also acts as the basic source of food supply for developing, underdeveloped or developed economy. Due to the rapid increase in population the demand for food is also increasing over time and in such a case agriculture provides certain food security.

The prime development of the Japanese agricultural sector took place during the time period of 1880 to 1940 and this is because at this point the agricultural productivity of the country increased significantly (Katz 2014). The magnitude of this increase in the level of productivity and the factors which were contributing towards this gain in productivity could be easily explained with a fair degree of confidence. The physical quantity of output of the six major crops of the country nearly doubled during 1881 to 1940. Similarly the estimated value of the net real incomes produced in the agricultural sector also depicted an analogical expansion pattern (Shankland and Euclides Gonçalves 2016). This was quite evident to take place because of the dominant position of the six identified staple crops-barley, rice, wheat, naked barley and white and sweet potato.

Current Scenario of Agriculture in Japan

The table above depicts the output of cocoons as it is considered significantly important for sericulture in Japan which contributed largely in the economic development of the country. However, it is also quite important to note that the radical increase in the output level of cocoons it is noteworthy that the percentage share of cocoons in the gross value of the agricultural products was rather low. During the decades prior to 1910 cocoons contributed to nearly 9 to 10 percent in the gross value of agricultural output. During the decade of 1911 to 1920 the contribution rose to 12 percent and further reached its highest value 16 percent in the year 1920. It again lowered to 12 percent in the 1930s (Watkins et al 2015).

However, agriculture is still now considered as a major industry in Japan and it has grown modestly since the past few decades. Japanese agricultural sector grew to $41 billion in 1985 from 12$12 billion in 1970. Further as per the recent statistics available it has reached $58 billion by the end of the year 2013 and thereby made the Japanese agriculture sector ninth largest in the world. Hence it can be stated that since the past few years the agricultural sector though faced a few problems it has managed to achieve and maintain a significant growth rate (Shively 2015).

The key problem of agriculture in Japan is the unavailability of land particularly because of the higher population density. Farmers are now terracing the hillsides and cultivating the river beds. Though, they are putting extensive efforts only 17 percent of total land area or 16 million acres of land is now available for agricultural purposes. Approximately 46% of this land is used for cultivating paddy and rice while 37% field is used for barley, wheat and other crops.

The Japanese people have put significant effort to cope with these issues both before and after the war but the labour productivity remained at a comparatively lower level (Shiva 2016). While the output of the agricultural sector crossed the prewar level of output, the labour productivity increased only by 8% and 5% during 1955 and 1956 respectively. As opined by Moyer, Wayne, and Tim (2017) the key problem associated with the Japanese agriculture is the farmland system. The main issues associated with this matter is that japan needs to design its strategy in such a way that farmland becomes concentrated only among those who are willing and are ready to get involved in the agricultural activities.

Challenges Faced by Japanese Agriculture

The International Assessment of Agricultural Science and Technology for Development (IAASTD) pointed out that despite putting drastic effort in the scientific and technological aspects and its implementation to increase the agricultural productivity people are barely concerned about the environmental consequences of these activities. Presently, IAASTD have focused on utilizing the knowledge, research, technological and scientific achievements for reducing hunger and thereby providing food security. However, as of now an industrialized country like Japan is more focused on nurturing the service sector and no such effective measures have been taken to improve the present agricultural scenario (Havens 2015).

In order to cope with the prevailing problems in an efficient manner during July, 1999 the New Basic Law on Food, Agriculture and Rural Areas replaced the Basic law on Agriculture (Miyazaki 2018). This decision was taken on the basis of the recommendations provided by an advisory committee to mitigate the problems associated with food, agriculture and rural areas. The key focus of the Basic Law of 1961 was to eradicate the inequality of productivity and income between the agricultural sector and service sector. However, the New Basic Law broadened the scope of agricultural policies that included food security, agricultural multi-functionality as well as rural development. The key principles of the new agricultural policy can be summarized as follows,

Ensuring stable supply of food: This would be done by enhancing the domestic level of production as a basis along with a suitable combination of stockholdings and imports (Ohkawa et al 2015).

Substantiating the multi-functional role of agriculture: Considering the safeguarding of water resources, land as well as natural environment and at the same time conserving the cultural traditions.

Developing agriculture in a sustainable manner: Maintaining the level of agricultural production and at the same point of time ensuring appropriate drainage, irrigation system and maintaining the natural cycle will help to maintain the sustainability of the agriculture (Lockwood 2015).

Rural development: Through improving the agricultural production and increasing the level of welfare in the rural areas will help to ensure development in those areas.

On the basis of the segments stated before it can be observed that agriculture in Japan lost its importance since ages. As the country started developing through industrialization more importance were given to the service sector and agriculture sector became less important. However, it is also quite evident that agriculture can significantly play a role in the process of development of a country. It can easily assist a country to ensure sufficient scope of employment and at the same time ascertain a constant supply of food. In the development policies designed by the country agriculture remained neglected but the researchers are now stressing on redesigning strategies which will ensure that the agriculture sector gets the importance it needed. Previously the Basic Plan for Food, Agriculture and Rural Areas included a few basic legal framework as well as provided the government with a set of suggestions so that it can improve the agricultural sector. Presently it is highly recommended that the government of Japan should try to redesign the previous strategy in an efficient manner so that the agricultural sector gets developed.

New Agricultural Policy of Japan

Conclusion

On a concluding note, it can be sated that the essay has focused on the agricultural sector of Japan. At certain point of time Japan’s agricultural sector ranked the ninth in the world in terms of production. Presently the country is considered among the most developed nations in the world but the contribution of agriculture in the total GDP of the country is significantly low. Though, it is an widely accepted fact that agriculture can assist a country to maintain a subsistence level of living and standard of living. Hence Japan should focus on developing a strategy which will aid its agricultural sector.

References

Bassino, Jean-Pascal, Stephen N. Broadberry, Kyoji Fukao, Bishnupriya Gupta, and Masanori Takashima. "Japan and the Great Divergence, 730-1874." (2017).

Havens, Thomas RH. Farm and nation in modern Japan: Agrarian nationalism, 1870-1940. Princeton University Press, 2015.

Katz, Richard. "Voodoo Abenomics: Japan's failed comeback plan." Foreign Affairs 93, no. 4 (2014): 133-141.

Lockwood, William Wirt. Economic Development of Japan. Princeton University Press, 2015.

Lockwood, William Wirt. State and Economic Enterprise in Japan. Princeton University Press, 2015.

Miyazaki, Tomomi. "Decentralization Reform and Property Tax in Japan: A Consideration of the Benefit Principle." In Economic Challenges Facing Japan’s Regional Areas, pp. 173-179. Palgrave Pivot, Singapore, 2018.

Moyer, Wayne, and Tim Josling. Agricultural Policy Reform: Politics and Process in the EU and US in the 1990s. Routledge, 2017.

Nakamura, James I. Agricultural production and the economic development of Japan, 1873-1922. Princeton University Press, 2015.

Ohkawa, Kazushi, Bruce F. Johnston, and Hiromitsu Kaneda. Agriculture and economic growth: Japan's experience. Princeton University Press, 2015.

Reganold, John P., and Jonathan M. Wachter. "Organic agriculture in the twenty-first century." Nature Plants 2, no. 2 (2016): 15221.

Saito, Osamu, and Masanori Takashima. "Estimating the shares of secondary-and tertiary-sector outputs in the age of early modern growth: the case of Japan, 1600–1874." European Review of Economic History 20, no. 3 (2016): 368-386.

Schandl, Heinz, Steve Hatfield-Dodds, Thomas Wiedmann, Arne Geschke, Yiyong Cai, James West, David Newth, Tim Baynes, Manfred Lenzen, and Anne Owen. "Decoupling global environmental pressure and economic growth: scenarios for energy use, materials use and carbon emissions." Journal of Cleaner Production 132 (2016): 45-56.

Shankland, Alex, and Euclides Gonçalves. "Imagining agricultural development in south–south cooperation: the contestation and transformation of ProSAVANA." World development 81 (2016): 35-46.

Shiva, Vandana. The violence of the green revolution: Third world agriculture, ecology, and politics. University Press of Kentucky, 2016.

Shively, Donald H., ed. Tradition and modernization in Japanese culture. Princeton University Press, 2015.

Watkins, Andrew, Theo Papaioannou, Julius Mugwagwa, and Dinar Kale. "National innovation systems and the intermediary role of industry associations in building institutional capacities for innovation in developing countries: A critical review of the literature." Research Policy 44, no. 8 (2015): 1407-1418.