Entrepreneurship in post-war Japan

The war wiped out many of the gains Japan had made since 1868. About 40% of the nation's industrial plants and infrastructure were destroyed, and production reverted to levels of about fifteen years earlier.

Post-war overall economic condition

Creates jobs (help decrease unemployment)

Pays government taxes Creates demand for products,

which in return creates other businesses

Introduces new technologies to the market

Stimulates the economy by instilling confidence in people

The importance of entrepreneurship development

There are two ways to do that:Through financial assistance

Through providing entrepreneurs with knowledge and information

So how did the Japanese government support entrepreneurs?

Subsidies (grants) for those who decided to start their own business

5% reduction in loans for each small business

Tax breaks to businesses that made the kind of investments that created jobs

Financial assistance aspect

Support for export-oriented businesses (in other words, support in research for foreign partners)

Cut as much paperwork and bureaucracy out of the system as it was possible

All-Japanese Association of Entrepreneurs "Support of Japan" (the main purpose of which was to protect entrepreneurs' interests and rights)

Information aspect

Income Composition of total personal income

Results

Time period Percentage

Pre-war (before 1939) 6,7%

War time (1939-1945) 13%

Post-war (1945-1952 and after)

2,5%

Percentage of unemployed

Year Income (yen)

1940 25,034

1944 11,713

1948 17,467

1952 26,446

1956 39,694

Average income change over the time

The thing is that United States took over Japan from 1945 to 1952. Their assistance totaled about $1.9 billion during the occupation.

They were getting prepared for the ideological battle between Capitalism and Communism (Soviet Union). So America’s main purpose was to bring many countries of the world on to their team.

So where did all the money come from?