Economy of Japan experienced a change from agriculture-based country into an industrial-based country. This change was started from the light industry, and gradually towards heavy and chemical industries. This change requires three elements, namely land, labor and capital.
After defeated in World War II, Japan had lost its land, namely land of Japan`s colonies in Asia, as well as capital. Therefore, Japan made efforts to revive the economy such as: for the land sector, Japan tried to do the reclamations of land it owned to build the factories. However, this did not work a lot. In terms of capital, Japan tried to make capital acquisitions to assemble his capital to rebuild its economy. In the case of labor, which was the only Japan owned at the time, Japan did a lot of labor absorption of rural areas to work in urban areas.
Around the year of 1955, Japan has managed to restore the economy back as the pre-war period. So, it was declared no longer as post-war period, because the economy is back as before the war. In 1960, the government announced a doubling income plan. The program aims for Japan to double its income around 7.2% each year, so that in 10 years, Japan income would be doubled compared with that time. The period is also called the golden egg, in which many fresh graduates from high school got to work in factories in larger cities.
As mentioned earlier, Japan experienced a shift from the state of agriculture-based country to the light industry finally to the state of heavy and chemical industry-based country. This also would result in economic shift from a labor intensive, land intensive, and eventually become capital intensive country.
To support this change, Japan made some policies, particularly those relating to industry. In the case of imports, Japan had gradually made the substitution of products imported and slowly reduced its import. With these policies, the state-owned property remained in the country. Also reducing imported products circulating in the country will simultaneously stimulate the local industry to continue to grow. With the growth of the domestic industry, the exports can be increased, so that will add the income received by Japan.
In the case of exports, Japan made several policies, namely neutral policy, increasing exports and labor intensive products. These regulations are set in such a way that Japan wanted to become export-based countries. Then Japan also conducts policy hollowing out the industry to encourage foreign investment and stimulate local production.
In addition to the policy in terms of exports and imports, Japan had also continued to globalize its product, sales and management. With globalization, Japan can do production overseas, and can increase the exports of foreign countries.