Prof. Andaya's argument that Southeast Asian societies had successfully operated on the basis of oral agreement legitimised by kinship relations while they were engaged in long distance commerce gives us helpful perspectives on studies of the role of rulers of Southeast Asian port cities. Her paper suggests the importance of key role players in mediating between different commercial networks.
Southeast Asia, being located at the crossroads between the South China Sea and the Indian Ocean, has been involved in international maritime trade since early times. Port cities such as Palembang (the centre of Srivijaya), Pasai (an early centre of Islam at north Sumatra), Malacca, Aceh, Banten, Ayutthaya, and Brunei appeared as important entrepots. At the same time, those port cities became outlets for local inland people, who bartered local products of pepper, forest products, and rice for Indian clothes, iron items, salt, etc. The basic role of the rulers of those port cities was to mediate between foreign merchants and local people. It is highly likely that such a role, as intermediary between the two different worlds, led to the differentiation of a commerce based on written contracts from another based on kinship ties. Prof. Andaya has clarified this.
On the one hand, rulers of those port cities endeavoured to attract many merchants and made their ports open to foreign visitors. Those port cities, especially during the early modern era, became cosmopolitan urban towns. Malacca, Aceh, Ayutthaya and Banten grew to populations of about one hundred thousand. In Malacca, which attracted merchants from west Asia, India, Southeast Asia and east Asia, four port officers (syabandar) were appointed among those foreign merchants in order to administer trade in the market. According to Tome Pires, who visited Malacca in the beginning of the sixteenth century, 84 languages were spoken there. Many of the rulers of Southeast Asian port cities became Muslims during the early modern era partly because they were trying to attract Muslim merchants and partly because Islam became an important international principle for those rulers whose port cities allowed multi-ethnic peoples from various areas to join their markets. Commercial activities using written contracts might well have been observed among Muslim and also Chinese merchants at those harbours.
On the other hand, those coastal rulers established firm connections with interior people who collected local products (in the case of Malacca, with the seafaring people in the Strait of Malacca ). The linkage between coastal rulers and hinterland and seafaring peoples, however, were not always based on Islam but rather on local terms. According to the royal chronicle of Malacca (Sejarah Melayu), seafaring people of the Strait of Malacca gave reverence to the future first ruler of the Malacca dynasty as a successor to the dynasty of Srivijaya and made an agreement with the ruler on mutual assistance. Also, the royal family of Pasai claims that the first ruler of Pasai was a son born to a girl who was born from bambu and a boy who was brought up by an elephant in Sumatran forests. Before the establishment of the port city of Pasai, the future first ruler of Pasai travelled to the hinterland of north Sumatra and successfully attracted the inland people, who asked him to become their king. The royal chronicles of both Pasai and Malacca claim that each of the first rulers, before those royal families accepted Islam, made firm connections with the hinterland people and sea nomads in the Strait of Malacca. The royal family of Pasai had strong ties with the inland people of north Sumatra. Those inland people brought pepper, gold and camphor to the ruler of Pasai. Also, the seafaring people of the Strait of Malacca became a main part of the royal navy of the Malacca royal family. Those connections between the coastal rulers and the inland and seafaring people were generally based on kinship relations and oral agreements.
The mediating role of coastal rulers between the two different worlds resulted in the hesitation of foreign merchants to have direct access to inland people and seafaring people. European and Arabian travellers often reported the rumour that inland people of Pasai and Aceh in north Sumatra were cannibals and that foreign merchants would be eaten as soon as they were caught by those interior people. To ascertain whether the rumour of cannibalism by the inland people was true or not is of little importance here. It is more important that because of such a rumour, foreign merchants who visited north Sumatra ports generally became reluctant to have direct access to the hinterland people. Similar types of rumours that the inland people of Java and Borneo were very savage and the sea nomads in the Strait of Malacca were highly warlike were also circulating among foreign visitors at Southeast Asian port cities during the early modern era.
Hinterland people were also generally afraid of direct contacts with foreign merchants, who often brought unfamiliar illnesses and occasionally captured inland people to sell them as slaves. Those inland people chose to barter local products for foreign merchandise through coastal rulers as intermediaries. As a result, rulers of those port cities successfully monopolised trade between foreign merchants and local people. For instance, Prof. Andaya vividly describes in one of her books the case of Palembang, where foreign merchants were not allowed to make direct contact with the inland people who cultivated pepper. This intermediary role of coastal rulers in Southeast Asia suggests the importance of brokers, interpreters, and also women, as Prof. Andaya argues, in commercial activities among peoples of differing political and economic systems. Syabandar in Southeast Asian ports played a mediating role similar to that played by rulers of the port cities toward foreign merchants. As those port cities developed into cosmopolitan towns, commercial activities between merchants coming from different areas needed the syabandar, who consulted with merchants in order to decide items for markets, and prices. Also, overseas Chinese at Southeast Asian port cities played a significant role in maintaining economic relations between those port cities and China. When Southeast Asian rulers sent missions to China, Chinese interpreters at Canton often revised letters from those rulers to the emperor of China in order to glorify the emperor more. The reverse was also the case. When answers from the Chinese emperor arrived, the overseas Chinese often rewrote them for their Southeast Asian rulers.
Whether commercial activities were based on written contracts or on oral or kinship ties, the role of mediator seems to be crucial. Long-distance commerce based on written contracts often gave rise to competition among traders. Smuggling occasionally occurred under such circumstances. Arab traders, especially Hadrami merchants, successfully made use of the competing situation between the Dutch and the British in the eighteenth and nineteenth centuries. While giving help to the British who endeavoured to drive "pirates" away from the Indian Ocean and insular Southeast Asia, at the same time those Hadrami merchants smuggled opium from Bengal and ammunition from the British into Southeast Asia. One of the British reports of the 1830s from Singapore reports that many Arab vessels from Java under the Dutch flag were credited with notorious smuggling.
These cases suggest the importance of the key persons who were able to mediate between different networks and who made agreements between the two. Perhaps we can further argue that those intermediary persons differentiated commerce based on written contracts from commerce based on kinship relations, and also differentiated formal commerce from smuggling.
Professor Wong is famous for having written and co-edited various influential works, including Nourish the People: The State Civilian Granary System in China, 1650-1950 (1991) and recently China Transformed: Historical Change and the Limits of European Experience (1997), in which he delved into an extraordinarily wide range of the literature in economic history other fields of historical research both in Europe and China. The discipline he takes for comparison is primarily socio-economic history. In his latest book, China Transformed, he compares China with Europe from the perspective of long-term economic development dynamics. In today's report, as in the book, Professor Wong shows us that factor and production markets were widespread in both China and Europe before the Industrial Revolution. Presenting adequate supporting evidence he says: the basic principles of economic expansions stressed by Adam Smithﾑdivision of labor, specialisation, and exchange are at work through parts of China in broadly the same manner as they were in Europe between the sixteenth and eighteenth centuries” (his paper today).
(1) The very reason his work encourages us is that he shows how the language of social science works to compare, and understand, histories. As he points out, the concepts of “property” and “market” represent phenomena that may differ depending on the historical setting. One of the difficulties of historical comparison is that we do not have any mutual language for such comparison beyond the borders between cultures, namely China, Islam and Southeast Asia. And we, the members of group C, decided to carry on our comparison before doing any further analysis of this linguistic problem. At the opening of today's session, Professor Miura said that through watching the game we find out the rules; however, the fact is that in researching history what we see is only descriptions, or the conceptions of describers, and is not a game itself at all. It is not the rule, but it is what describers thought to be the rule that we are trying to find out. The problem of what language we can talk in about property (suoyou in Chinese), contract (ch'iyue), or market (shichang) has been set aside, as we are always afraid of a collapse of conversations across the borders of the regions we deal with. Professor Wong's work is a successful example of such comparative history, often using generally recongnised economic concepts, especially those of Adam Smith and other classical economists. At least now we are more confident that we can use Smith to explain historical facts concerning property, contract, and market.
The methodology we use may be criticised by cultural relativists. They may see no sense in comparing similar but different concepts in different contexts. Facing this question, we have only two choices. One is to express each region's concept concerning matters somewhat related to three words in contemporary use: property, contract and market. The other choice is to quit comparative history and shut up our mouths. We have taken the first choice. We think we can find a language with which to hold dialogues about similar things, In other words, we haven't stopped our efforts to explore the past standing on a same basis of language. In this sense, we are clearly try to overcome cultural relativism. When we discover Professor Wong's successful works of comparison between the economies of China and Europe, we are so encouraged.
Professor Daniel Little has criticised the explanatory paradigm that tends to admit causal explanations (Understanding Peasant China, 1989), basing his assertions on his analysis of some works of Asian economic history, particularly those having Malthusian and Marxian points of view, including the work of Kang Chao and others, However, recently Little himself, in a review article entitled “Explaining Large-Scale Historical Change” (2000), praised Wong's book (1997) that explains Chinese and European economic development. Professor Little seems to have stepped back from his former position opposing historical works that give a modern interpretation to historical phenomena.
(2) Something that scholars who are not from Europe or the United States find especially interesting is that Professor Wong enthusiastically tries to deny any absolute superiority of Europe's economy in the sexteenth thruogh nineteenth centuries over China's. Because we have been informed lots of facts about Asian commercialization and wide-spread factor/production markets for decades, we now think the Asian economy was not behind in many aspects before the Industrial Revolution. But the issue, and our interest, relates not so much to which is more advanced but, instead, to what are the differences in structures of order in Chinese, Islamic and European societies. We do not see any societies collapse just because of a lack of order, in the way Hobbes asserted they would, therefore we conclude that every society must have had a form of social order, whether unique or not. From an economic point of view, every political-economic unit must have had an order of transaction. Otherwise, this unit doesn't exist. As a matter of fact, in China, the Islamic Middle East, Europe, or anywhere, it is difficult to conceive that a groups of a certain number of people cannot keep any order, and fail to have market transactions because of lack in any formal/infromal institutions. Orders and transactions were there. The real question is what were the orders (social as well as economic) like? To put this question into economic language, what enabled transactions by reducing transaction cost? If such devices did not exist, we might indeed see lots of societies collapse as Hobbes predicted. But the fact is, each societyﾑChina, Europe, the Islamic Middle East, and Southeast Asiaﾑwas well organised and had a rather high market economy performance (as we would say it today).
In this regard, Professor Iwatake emphasises that what makes transactions work in Islamic societies is coherence of laws as well as a faith in God, and Professor Kishimoto stresses networks and personal credit in China, just as Professor Furuta points out how go-betweens cut transaction costs such as risk, monitor and obligation costs in China. In today's report, Professor Andaya pointed out that documentation was important for powerful merchants like the Muslims and Chinese in Southeast Asia. These are all various types of economic orders in different regions, but they equally prevent market transactions from failure by too high transaction costs.
(3) What I asked Professor Wong was how he estimates the importance of institutions. It is natural to imagine that there were different economic performances among various economies. And in New Institutional Economics, particularly in the books by Douglass North to which Professor Wong himself often refers, the concept is emphasised with the words, “institutions matter.” If this is so, does he see in these regions any differences in institutions that really mattered to economic performance? Or, if he agrees with the views of M. Elvin, E. L. Jones and many others that the Sung dynasty economy was China's most prosperous, does Professor Wong see any particular set of institutions of that dynasty that made a difference in its economic performance?
My second question to Professor Wong was what is his opinion of David Landes, who in his recent work asserts superiority for European institutions for later economic success after the Industrial Revolution?
To my questions, Professor Wong gave clear answers in his response at the workshop. Because it is impossible to prove whether labour productivity in the Sung times was higher or lower than that of the Ming-Ch'ing periods, he sees no point to the assertion that the Sung dynasty had high economic growth. As for David Landes Professor Wong has already argued pre-industrial world economy with A. G. Frank and other theorists. It is sad “David” produced such a book, Professor Wong implied. His work clarifies later gaps between industrialised Europe and unsuccessful China, which can never return to its pre-industrialised economy; Landes' argument has in this sense no coherence with Professor Wong's.
Deng, Kent G. 2000. “A Critical Survey of Recent Research in Chinese Economic History.” Economic History Review, 80/1.
Frank, Andre Gunder. 1998. ReOrient : Global Economy in the Asian Age. Berkeley: University of California Press.
Jones, E. L. 1988. Growth Recurring: Economic Change in World History. Oxford: Claredon Press.
--------------. 1990. “The Real Question about China: Why was the Song Economic Achievement Not Repeated?” Australian Economic History Review, 30/2. Landes, David S. 1998. The Wealth and Poverty of Nations : Why Some are so Rich and Some so Poor. New York: Norton.
Lieberman, Victor. 1997. “Transcending East-West Dichotomies: State and Culture Formation in Six Ostensibly Disparate Areas.” Modern Asian Studies, 31
Little, Daniel. 2000. “Explaining Large-Scale Historical Change.”Philosophy of the Social Sciences 30:1.
----------------. 1989. Understanding Peasant China, Yale University Press.
Wong, R. Bin (eds.). 1991. Nourish the People: The State Civilian Granary System in China, 1650-1950. Ann Arbor: Center for Chinese Studies, University of Michigan..
-----------------. 1997. China Transformed : Historical Change and the Limits of European Experience. Ithaca: Cornell University Press.
SUEYASU, Ando. 1995-96. “An Investigation ﾔCycles of Demystification' in Western Social Theory -- An Attempt of a Sociology of Law for Reopening of Intercultural Dialogue with China,” Hogakuronso (Kyoto Law Review) ,137/6，139/2.
Prof. Reilly's presentation gives us general and detailed information about local and regional markets in Ottoman Syria. The local or regional market is a popular subject for Japanese historians, especially the social and economic historians of the older generation, those now over fifty. This may explain why the local and regional market is a subject in which I myself have been interested. My major field is the social and economic history of modern Egypt, and my age is just fifty-one. I stand on the border between the new and old generations.
Prof. Miura, one of the organisers of this workshop, said to me that this workshop was arranged to promote the frank discussion or exchange of opinion between Japanese and foreign researchers on the subjects concerned. So, I would like to introduce to foreign scholars the atmosphere in the Japanese academy on the local and regional market. Historians might agree that we research the same subjects but by different perspectives or concerns, and the difference in perspective on one study subject will in many cases be generated by the academic atmosphere in which we have been educated and now do research.
The Japanese academy of historical sciences has an agriculture-centred view of historyﾑin an academic term, the physiocracy or "agriculture-first" principle. Japanese academic circles of the older generation believed that the key to economic development and modern society was to modernise agriculture and improve farmers' lives.
This emphasis on agriculture was based on the economic development pattern of Japan, as well as that of Europe (or, to be precise, England, France, and Germany in western Europe, after which Japan modelled its construction of a modern state). Of course, this emphasis on agriculture has now been weakened because of changes in social structure and lifestyle among the Japanese people since the 1980s. The economic position of agriculture in both advanced and developing countries has rapidly declined.
This decline is also part of the emergence of post-industrial capitalism and the information-oriented society. Researchers in the field of Japanese as well as European history started to energetically study the non-agricultural societies, with a particular focus on social groups engaged in non-agricultural occupations.
It was quite natural that researchers in the field of Middle Eastern or Islamic history were influenced by this change of the academic atmosphere. Today, their main subjects are non-agricultural, especially commercial activities, societies, organisations, social groups and so on. One reason for this academic trend in Middle Eastern or Islamic history is the sympathetic combination of the above-mentioned change of academic atmosphere with the nature of Middle Eastern societies characterised by the mercantile or urban way of life.
However, the frame of thinking does not radically change, or in other terms, a change in the frame of thinking usually follows the transformation of the material circumstances only after a long interval. Thus, we are today still under the shadow of an agriculture-centred view of history.
The academic school in Japanese historical sciences that most clearly represents the "agriculture-first" principle is the Ohtuka school, named for the famous economic historian, Ohtuka Hisao. This school overwhelmed the Japanese academy of historical sciences in the 1950s and 1960s. Its theory, known as the Ohtuka historical theory, systematises the process of economic and social development from the pre-capital or pre-modern stage to the capital or modern stage, presupposing the framework of modern states. One of the most important concepts in its theory is the "kyokuchiteki-shijyouken" or regional market.
According to the theory, the door to sound development of a national economy for capitalisation or industrialisation could not open without the formation of regional markets. However, the point is not the existence or scale of a regional market in itself but its economic role or function, as connected with wider economies, national and international economies. In other words, it is not important whether the regional market exists or not, and what scale the regional market has. What is important is how the regional market is organised and managed within the wider economies.
The regional market, as a system leading the national economy to a sound development of industrialisation, should be the space in which the economic actors, especially the middle-class producers, can invest the capital they accumulated in non-agricultural and industrial sectors, being free of traditional restrictions such as those imposed by guild-like co-operations in medieval times.
In the theory of the Ohtuka school, the cities or urban centres are considered negative factors that prevent the national economy from walking on the road of sound development to industrialisation, because the cities are where merchants dwell, organised under the restrictions of guild-like corporations and extending their rule and influence to the rural area by a network of commercial capitals and regional markets. In conclusion, the existence of regional markets could be a necessary condition for a sound and independent national economy, but it could not be a sufficient condition because the regional markets have negative effects on the national economy by being connected with traditional urban centres. In this sense, Ohtuka theory is similar to the theory of proto-industrialisation in European economic history, trying to explain the emergence of industrialisation in a rural context.
From the viewpoint of theory, as well as policy-making for the formation of a sound and independent national economy, the key issue is how the regional markets are constructed free from the traditional urban centres, or in today's terms, the world economy or the global economy, in which economic actors perform regardless of, or beyond the borders of, states.
On this point, the theory of the Ohtuka school is similar to that of the school of dependence, which insists on cutting off from the world economy in order to construct an independent national economy. I myself have not been a follower of the Ohtuka school. I have always felt about Ohtuka theory, at least as a theory of historiography, a sense of incongruity in its dichotomies: urban and rural, productive and non-productive, commercial and industrial, national and international, and so on.
But, I have respected Ohtuka theory as an original Japanese framework of thinking about economic history, especially the systematisation of the relationship between the economic development of macro scale and micro scale, which makes clear the originality and perspective of our Japanese scholars' interests in economic history. Historical sciences are deeply connected with the choice of unit of study, which in our context is the choice between, on the one hand, economic development, capital accumulation, income distribution, social welfare, and so on within a national economy, and on the other hand, those same subjects in the global world economy.
According to Ohtuka theory, the regional market could be not only a tool for the sound development of a national economy but also a bridgehead for dependence of the national economy on world economy. I chose the economy of the national or regional level. In this sense, I am a follower, but a disobedient follower, of the Ohtuka school. This is my comment to Prof. Reilly's presentation. The model of the regional market presented by Ohtuka theory, reflecting the agriculture-centred view of history in Japan, is in sharp contrast with the description of the local and regional markets in Ottoman Syria, presented by Prof. Reilly, which were organised by urban centres and deeply connected with international trade.
But the model is only a tool for analysis, so Ohtuka theory is useful for comparative study of regional markets in economic history, especially the relationship between the market of micro scale and the market of macro scale. In this context, the important problems are by what institutions or customsﾑthat is, kinship, religious tie, oral or documentary contract and so onﾑthese two markets of different scale are connected, and what will be the effects or repercussions of this connection on the economic development and social structure in the region concerned.
Three papers were presented at the International Workshop of Comparative Study. Each one of them was engaging and focused on distinctive themes. Since the title of this workshop “Ownership, Contracts, and Markets”is broad and includes all key concepts discussed at previous meetings, it is not surprising that it was difficult to find a common theme. My comments therefore deal with the papers one at a time. I will discuss Professor Andaya's paper first and move on to Professor Reilly's because both dealt with specific topics, and later Professor Wong's paper on methodology in comparative studies.
The first paper presented by Professor Barbara Andaya was quite clear in its theme and organization. It dealt with the practice of trade contracts in pre-colonial Southeast Asia and argued that indigenous traders in Southeast Asia, because they were illiterate, used oral contracts in exchanging goods. The practice of oral contracts contributed to their retreat from long-distance trade in Southeast Asia, giving away the position to foreign traders who were accustomed to using written contracts. Her argument was lucid and convincing.
One question occurred to me later, however, while listening to Professor James Reilly's paper. Professor Reilly pointed out that in the Middle East which was considered a “contract society” most transactions in goods were conducted by oral contracts in the 18th and 19th centuries. Although the practice in long-distance trade was not specifically mentioned, one can assume that was the case as long as the circumstances permitted. The situation in the Middle East suggests that oral contracts were not an inevitable consequence of illiteracy but that it was often preferred to written contracts in many parts of world. Professor Reilly mentions in his paper that“in closely knit and stable communities...a person's capital included his or her good word.” This same notion may have supported the prevalent practice of oral contracts in Southeast Asia.
Yet, as Professor Andaya suggested, the situation in Southeast Asian long-distance trade was probably too anarchical to keep this traditional practice. It was sea-borne trade which was open to anyone who was able to participate, in contrast to primarily inland trade in the Middle East. The use of the written agreement was probably unavoidable in these circumstances in the Southeast Asia.
Professor James Reilly's paper about Ottoman Syrian economies in the 18th and 19th centuries took up many important themes, which could be divided largely into three sections. The first section discussed three regional economic centers in Ottoman Syria, Hama, Damascus, and Sidon, and the second dealt with the practice of oral and written contracts. The third section focused on the local response to the encroachment of the capitalist world economy in the 19th century.
In the last section Professor Reilly asserted that Syria represented “a particular type of capitalist development”and that Syria showed remarkable resilience against the advance of the world market by pointing out examples in the fields of industry, commerce and agriculture. Despite these examples, however, I felt that his explanations were insufficient. I would like to have heard which economic areas were precisely affected by the encroachment of the world market and which areas were not, as well as the overall degree of the encroachment in Syria. In order to make a final assessment, one might need to draw a more complete picture of the encroachment. One such approach will be to make a closer examination of particular economic centers such as the three centers Professor Reilly discussed in the first section. It may also be interesting to make comparisons between the situations in Syria and other regions such as Egypt or Anatolia.
The central theme of Professor Wong's paper was methodology in comparative studies. One instructive method was to select a number of relevant elements pertaining to a given concept such as capitalism and compare the elements of different regions. Also interesting was the comparison of two regions over time instead of a static one-point comparison. There is, however, one thing I felt uneasy about in his paper. While discussing the factors for economic divergence between Europe and China, particularly at the time of the Industrial Revolution, he not only denied the crucial importance of such factors as property rights, market activities, and science and technology, but he also dismissed the differences resulting from the political economy of agrarian empire and commercial capitalism. Although the question seems worth exploring, perhaps one should understand that Professor Wong's main concern is not in finding the factors, but that he primarily tries, through comparison, to discern the natures of economic change in the two regions.