Eudal lords during the era of 16th Century Japan

M.C. Huang A.R. Leen

National Graduate Institute for

National Cheng-Kung Policy Studies Leiden University

Japan The Netherlands

Abstract

Huang, M. C. & Leen, A. R.

‘Revisiting the Feudal Free Market System in Japan: What Made The Golden
Age of Azuchi-Momoyama’

Unlike other feudal lords during the era of 16

Century Japan, who ruled

by way of a primarily autarkic economy, Nobunaga Oda emerged as a powerful
player  by  implementing  free  market  system  with  vibrant  external  trades  that
accumulated vast amounts of wealth and capital with which he could expand his
regime.  He  abolished  trading  barriers  and  reduced  restrictions  in  commercial
activities,  which  led  to  the  domination  of  commercial  capital  and  created
prosperity. Art and cultural activities were encouraged and patronised, resulting
in  the  Azuchi-Momoyama,  the  so-called  ‘golden  age’  with  great  castles,  tea
ceremony and the special economic zone that still preserved until today.

JEL classification: N00; N01; N10; N15; P16.
Keywords: Nobunaga Oda, free market system, Azuchi-Momoyama, Sengoku,
mercantilism.

1. The

Sengoku

(War) Period

Over the course of the 16

Century, Japan transformed itself from a

largely fragmented nation into a successfully centralised state; indeed, this was
the most efficient system of government prior to modern times. Before the
transformation, Japan had experienced an era of protracted military competition
among the warlord figures (

Daimyo

) that had multiplied in the provinces. Whilst

the Emperor (Tenno) and his military delegate (Muromachi Bakufu) maintained
power  in  the  capital  city,  Kyoto,  neither  possessed  the  capability  to  influence
events  outside  that  realm.  It  was  extremely  difficult  to  identify  income  and
expenditure on a domain basis. The struggle of commerce became an economic
and  military  necessity  for  the

Daimyo

struggling to establish a firm hold over

their domains in a situation comparable to European mercantilism. A
fundamental problem faced by the

Daimyo

when seeking to expand their control

over commercial activity was the growth in commercial trade and inter-village

Bron A.R. Leen with M.C. Huang, 'How a free market system resulted in hegemony and a magnificent era: the case of

Nobunga oda, 16th century, Japan', in: Archives of Economic History, vol. XIX, no.1, ISSN 1108-7005, pp. 5-16.

The Sengoku (Age of Civil War between 1467 to 1603) is a period in Japanese while military conflict among many

regimes before all political power was unified under the Tokugawa in 1603. During this period, the Shogun (Military lord)

or the Emperor of Japan was officially the ruler of his nation and every lord swore loyalty to him, he was largely a
marginalised and a symbolic icon.

trade within their domains. Transport and customs taxes were a new source of
income for the

Daimyo

, and their appeal was undeniable. The individual

Daimyo

however, had to be able to assert his authority over the fief holders whose lands
were situated near thoroughfares or rivers in order to erect private barriers.

The

Daimyo

, especially the ones powerful enough to assert regional

authority,  were  in  nearly  all  respects  locally  autonomous.  They  asserted  full
property  rights  over  their  domains,  enforcing  retainers  in  return  for  military
protection.  Strategic  castle  headquarters  were  built  for  defensive  purposes;
these  were  flocked  by  merchants,  artisans  and  the  inhabitants  of  the  local
temples  of  major  Buddhist  denominations.

Daimyo

issued their own laws and

currency, and referred to their domains as their country. For a time, the whole of
Japan was controlled by military hegemonies imposed by the Tokugawa House.
For these reasons, the unification that took place in the 16

Century might be

better understood as a period of

pacification

. It was brought about by the

combined efforts of three regimes, namely those of Nobunaga Oda, Hideyoshi
Toyotomi and Ieyasu Tokugawa. This article will focus on an examination of the
first of these - Nobunaga Oda – and specifically his pioneering economic policies
in the period directly prior to Tokugawa.

2. Theoretical Background: What factors contributed to Oda’s hegemony?

During the 16

Century, Japan’s

samurai

began their dramatic passage

from rural patrimony to establishing themselves within the urban setting. By the
end of this process, the

samurai

had transformed themselves from landed

proprietors  to  stipend  officials  who  possessed  the  institutionalised  right  to
govern society by virtue of their military status. This signified Japan’s transition
from  the  medieval  to  the  early  modern  era.  There  have  been  many  academic
studies into the contributing factors behind  Nobunaga Oda’s rise to hegemony;
including  Birt’s  (1985)  examination  of  Oda’s  modern  army.  Other  observers

emphasize the monopoly power of the political capital, Kyoto, and of commercial
capital (Sakai).

Other observers emphasise the monopolising powers held by the

administrative capital, Kyoto, and Sakai. However, few attempts have been made
to analyse Oda’s free market and monetary policies, believed by the authors of
this article to be central reasons behind his rise to power.

Commerce in 16

Century Japan was no longer restricted by the regime;

individual  cities  retained  the  right  to  adjust  and  develop  (Wakita,  Hirayama  &
Ishida, 1951: 128). When Oda invaded Kyoto, instead of burning it in the manner
of  various  predecessors,  he  established  a  free  market  that  enabled  the  city  to
become self-autonomous, requesting only financial support in return. This policy
was  executed  with  even  greater  sophistication  when  Toyotomi  acceded  to
power;  the  free  market  system  expanded  from  Kyoto  to  Osaka  and  several
autonomous  ports  were  established.  Some  regard  these  developments  during

This period, named Azuchi-Momoyama after the two greatest castles built

by Oda and Toyotomi, has come to be regarded as the most magnificent era in
Japanese history. In Oda’s territory, western culture was harmoniously
integrated into Japanese life, as the powerful

Daimyo

was eager to gain access to

the  latest  global  technological  developments.  Huge  castles  began  to  be
constructed, designed for aesthetic rather than defensive purposes, resulting in
huge  opportunities  for  artists  and  artisans  in  the  business  of  decoration  and
entertainment.  The  castle  towns  and  their  development  initiated  by  Nobunaga
Oda’s  Asuchi  castle  and  Hideyoshi  Toyotomi’s  Osaka  Castle  are  national
headquarters  for  assemble  and  support  the  growing  corps  of  officers  and
soldiers  (Hall,  1955).  According  to  McClain  (1980),  during  1580  to  1700,  the
Japanese  growth  could  be  marked  the  most  exceptional  period  in  the  world
history while the population of Japan doubled. Those great wooden castles after
Oda  and  Toyotomi  such  as  Himeji  Castle,  Hikone  Castles,  Inuyama  Castles  and
Matsumoto Castles that are remained till the 21

century

are the heritage from

Azuchi-Momoyama and now serve as national treasure and symbols of Japan.

3. Three Approaches to Oda’s Hegemony

Oda’s innovative way of thinking predated similar Western developments

by nearly two hundred years, making the Azuchi-Momoyama period worthy of
further research. This article will analyse Oda’s rule, specifically examining the
following three factors, which it regards as the main reasons for his success:



Creating a free trade market

The  Oda  and  Toyotomi  administrations  emerged  against  the  traditional
backdrop  of  marketing  relations  and  marketing  structure.  Each  undertook  its
own  set  of  reforms.  Oda  created  a  free  trade  policy  for  merchants  in  the
provinces  of  Mino

and Owari, ordering

‘free markets and free guilds’

(

Rakuichi-

rakuza

) in the castle towns of Azuchi

and Kano. The credo refers to a commercial

policy whereby Sengoku

Daimyo

abolished both monopolistic guilds and the

obligation to trade within certain privately controlled markets (

Ichi

Great effort was put into abolishing checkpoints, therefore facilitating a

larger  volume  of  trade.  Oda,  however,  did  not  implement  these  policies  in  his
capital  city  of  Kyoto,  contrary  to  previously  held  opinions.  Hence,  guild
organisations  remained  active  in  Kyoto  and  Nara,  where  Oda  protected  the
established guild merchants and recognised their special rights.

Most of the great castles in Japan today are rebuilt after World War II with concreted structures

(Nagoya Castle, Kumamoto Castle, Hiroshima Castle, Matsuyama Castle etc.).

The Azuchi Castle was burned in 1582 after Nobunaga’s death in the Mitsuhide Akechi’s rebel.

The real reason of the fire remained unknown. The Osaka Castle was burned in the Battle of

Osaka in 1616, although once rebuilt in AC. 1626 but was burned by thunder in 1665. The
current Osaka Castle with concreted structure was built in 1931.