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Harvard East Asian Monographs #334
Coins, Trade, and the State: Economic Growth in Early Medieval Japan
Framed by the decline of the Heian aristocracy in the late 1100s and the rise of the Tokugawa shogunate in the early 1600s, Japan’s medieval era was a chaotic period of diffuse political power and frequent military strife. This instability prevented central authorities from regulating trade, issuing currency, enforcing contracts, or guaranteeing property rights. But the lack of a strong central government did not inhibit economic growth. Rather, it created opportunities for a wider spectrum of society to participate in trade, markets, and monetization.
Peripheral elites―including merchants, warriors, rural estate managers, and religious leaders―devised new ways to circumvent older forms of exchange by importing Chinese currency, trading in local markets, and building an effective system of long-distance money remittance. Over time, the central government recognized the futility of trying to stifle these developments, and by the sixteenth century it asserted greater control over monetary matters throughout the realm.
Drawing upon diaries, tax ledgers, temple records, and government decrees, Ethan Isaac Segal chronicles how the circulation of copper currency and the expansion of trade led to the start of a market-centered economy and laid the groundwork for Japan’s transformation into an early modern society.
Peripheral elites―including merchants, warriors, rural estate managers, and religious leaders―devised new ways to circumvent older forms of exchange by importing Chinese currency, trading in local markets, and building an effective system of long-distance money remittance. Over time, the central government recognized the futility of trying to stifle these developments, and by the sixteenth century it asserted greater control over monetary matters throughout the realm.
Drawing upon diaries, tax ledgers, temple records, and government decrees, Ethan Isaac Segal chronicles how the circulation of copper currency and the expansion of trade led to the start of a market-centered economy and laid the groundwork for Japan’s transformation into an early modern society.
- GenresJapan
276 pages, Hardcover
First published May 1, 2011
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January 21, 2026
Despite its subtitle, Ethan Segal’s Coins, Trade, and the State: Economic Growth in Early Medieval Japan (2011) has little merit as a study of the ‘economic growth’ of the period in itself. The vast majority of the monograph is, rather, spent analyzing what could be properly seen as the institutional super-/infra-structure of said growth, that is the history of coinage, markets, and government policy. In this domain, Segal’s study is invaluable, in particular for its iteration on some of the rather intricate debates over, e.g., the coinage policy of the late-Heian/early-medieval court, and the context of the Kamakura bakufu’s tokuseirei edict of 1297. Furthermore, it effectively illustrates the degree to which the commercial/institutional infrastructure of the Tokugawa economy was laid during the medieval period, and that a multiplicity of different actors played active roles in the commercialization of medieval Japanese society. Rather than focusing on this facet of the work, however, based as it is by necessity on what, for the non-specialist, is a fairly recherché collection of evidence (indeed, as with any work of this nature, the representativeness of the evidence Segal brings to bear could probably be challenged), I will focus here on its coverage of the underlying context to these institutional developments: ‘economic growth’.
While the work clearly focuses on the above-discussed themes, it must be stated that the work also frames its argument around the idea of economic growth; Segal argues that the late-medieval period was paradoxically characterized by growth despite the disintegration of central authority. In fact, to Segal, it may have been this weakening of central authority under the Muromachi bakufu which enabled the economy to grow. These arguments are interesting, but unfortunately, Coins, Trade, and the State is plagued at times by a loose concern for cause and effect. Its largest flaw is that it pays essentially no attention to the demand side of the economy. Not once in the book does Segal even muse on the question: who was buying the goods that were being sold for commutation into coin to take place? Instead, we are provided such empty statements as: “the growth of . . . regional commerce created demand for estate goods outside of the capital” (p. 166). “Regional commerce” in itself is only the infrastructure by which some purchase the surplus produced by others, either out of necessity or want. If, as Segal states, “local markets emerged in large part due to the agricultural surplus that resulted from double-cropping and new rice strains” (p. 164), and the average producer was taking home an increasingly larger share of surplus as the developments of the medieval period took place, then it is not immediately obvious who made up the new market of consumers that was purchasing the goods that were being sold for cash—especially when we remember that much of what was being sold on the market was (formerly tribute) rice and other foodstuffs, the same goods that individual producers were creating a bigger surplus of at the same time. Urban populations would have not been large enough at this point to produce sufficient demand, and so the obvious answer is that there was an increasing proportion of the Japanese population that no longer produced enough goods for subsistence. Of course, a study of this nature is restricted by the sources available. There are far more documents that touch on supply-side factors (e.g. institutions, technology) than on demand. That being said, as I hope I have highlighted above, even with the limited evidence available, it should at least be possible to discuss the topic in a more logical manner.
Additionally, the limitations of sources could have been partially circumvented through a more comparative approach. At times, Segal appears to frame his study as such—the final page, for example, concludes with the citation of institutional economist Avner Greif, on the ‘good’ and ‘bad’ institutions in medieval Europe—but these engagements with the literature beyond Japan are woefully inadequate. Greif represents an outmodded and inadequate formulation of base Institutionalist economic history several generations out-of-date, at least among medieval economic historians of Europe; Segal’s bibliography is conspicuously missing both Sheilagh Ogilvie and Stephan R. Epstein, who have far more nuanced, and historically grounded, (though differing) views on the role of institutions in premodern economic growth and markets. Furthermore, in recent decades, among both Marxist and non-Marxist economic historians of medieval Europe, supply-side factors have been given much reduced emphasis vis-à-vis demand; to my mind there is no excuse for not citing Chris Wickham’s landmark study, Framing the Early Middle Ages (2005), in this work. On coinage, Segal could have benefited from engagement with the work of Peter Spufford.
In addition to the case of Greif discussed above, where Segal engages in the history of medieval Europe, he is several decades out of date on the historiography. For example, in describing the bakufu–retainer relationship, Segal spends a page relaying Georges Duby’s narrative of a transition from a European ‘gift economy’ in the eighth century, in which “commerce was a fringe activity,” “tangential,” “left to Jews and foreigners while barter was practiced on a large scale” (p. 141–43), to a much more commercialized economy in the twelfth century. The book Segal is drawing on here was published in 1978, and no medievalist working today would describe the early middle ages in these terms.
While the work clearly focuses on the above-discussed themes, it must be stated that the work also frames its argument around the idea of economic growth; Segal argues that the late-medieval period was paradoxically characterized by growth despite the disintegration of central authority. In fact, to Segal, it may have been this weakening of central authority under the Muromachi bakufu which enabled the economy to grow. These arguments are interesting, but unfortunately, Coins, Trade, and the State is plagued at times by a loose concern for cause and effect. Its largest flaw is that it pays essentially no attention to the demand side of the economy. Not once in the book does Segal even muse on the question: who was buying the goods that were being sold for commutation into coin to take place? Instead, we are provided such empty statements as: “the growth of . . . regional commerce created demand for estate goods outside of the capital” (p. 166). “Regional commerce” in itself is only the infrastructure by which some purchase the surplus produced by others, either out of necessity or want. If, as Segal states, “local markets emerged in large part due to the agricultural surplus that resulted from double-cropping and new rice strains” (p. 164), and the average producer was taking home an increasingly larger share of surplus as the developments of the medieval period took place, then it is not immediately obvious who made up the new market of consumers that was purchasing the goods that were being sold for cash—especially when we remember that much of what was being sold on the market was (formerly tribute) rice and other foodstuffs, the same goods that individual producers were creating a bigger surplus of at the same time. Urban populations would have not been large enough at this point to produce sufficient demand, and so the obvious answer is that there was an increasing proportion of the Japanese population that no longer produced enough goods for subsistence. Of course, a study of this nature is restricted by the sources available. There are far more documents that touch on supply-side factors (e.g. institutions, technology) than on demand. That being said, as I hope I have highlighted above, even with the limited evidence available, it should at least be possible to discuss the topic in a more logical manner.
Additionally, the limitations of sources could have been partially circumvented through a more comparative approach. At times, Segal appears to frame his study as such—the final page, for example, concludes with the citation of institutional economist Avner Greif, on the ‘good’ and ‘bad’ institutions in medieval Europe—but these engagements with the literature beyond Japan are woefully inadequate. Greif represents an outmodded and inadequate formulation of base Institutionalist economic history several generations out-of-date, at least among medieval economic historians of Europe; Segal’s bibliography is conspicuously missing both Sheilagh Ogilvie and Stephan R. Epstein, who have far more nuanced, and historically grounded, (though differing) views on the role of institutions in premodern economic growth and markets. Furthermore, in recent decades, among both Marxist and non-Marxist economic historians of medieval Europe, supply-side factors have been given much reduced emphasis vis-à-vis demand; to my mind there is no excuse for not citing Chris Wickham’s landmark study, Framing the Early Middle Ages (2005), in this work. On coinage, Segal could have benefited from engagement with the work of Peter Spufford.
In addition to the case of Greif discussed above, where Segal engages in the history of medieval Europe, he is several decades out of date on the historiography. For example, in describing the bakufu–retainer relationship, Segal spends a page relaying Georges Duby’s narrative of a transition from a European ‘gift economy’ in the eighth century, in which “commerce was a fringe activity,” “tangential,” “left to Jews and foreigners while barter was practiced on a large scale” (p. 141–43), to a much more commercialized economy in the twelfth century. The book Segal is drawing on here was published in 1978, and no medievalist working today would describe the early middle ages in these terms.
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