eli5 How did Japan become a technology superpower after WW2?
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There are some macro and world factors, but internally, MITI is what made Japan different.
The Ministry of International.Trade and Industry had a heavy hand in directing Japan’s research and investment. Post WW2, MITI help reindustrialize Japan by more or less providing a centralized organization that could advise and direct the expansion of industries it considered key to Japan’s success. It helped get capital, arrange research trips, advise on mergers, etc.
They sometimes even decided which companies could and could not work within certain industries, in order to prevent excess competition. And they weren’t always right. Famously, MITI did not approve of Honda (which had been famous for its motorcycles) producing cars. MITI sought to restrict car production to Japan’s established car companies, like Toyota and Nissan. Honda outmaneuvered MITI and succeeded in spite of the organization’s disapproval. Still, Honda may never have risen to success without MITI’s early grants, back when Honda was just a scrappy, small motorcycle company – just one of hundreds of scrappy small motorcycle companies in Japan.
Probably most importantly, MITI was heavily protectionist and it shielded Japanese companies from foreign competition, allowing them to grow. It also kept exchange rates favorable to exports, which allowed Japan to compete abroad – perhaps unfairly.
As Japan’s economy shifted (sometimes under intense US lobbying, seeking faired trade agreements) and later collapsed, MITI lost a lot of its power. Still, up until about the mid ’70s, Japanese companies were often reliant on MITI’s approval, guidance and financial support.
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