Textile Industry

Abstract

Japan’s modern textile industry began in 1872, when the government constructed silk yarn works in Tomioka. Before the Second World War, textiles were a key export industry, earning foreign reserves. After the war, textiles contributed to Japan’s era of rapid growth and for several decades remained an important export. With Japan’s ascension to the first rank of the world’s high-tech economies over the past two and a half decades, the country has lost much of its comparative advantage in labor-intensive industries like textiles. Continuing productivity improvements — boosted by partner institutions — have enabled the industry to continue to grow in some respects, particularly those that can be automated. But the explosion of textile manufacturing in developing countries will not be reversed to the advantage of advanced, high-wage economies such as Japan’s. Still, the lessons of Japan’s experience, including the development of its networks of firms and their connection to other organizations, may be applicable to other countries as their industries grow.