Shigeto Tsuru passed away on 5 February 2006 at the age of 93. He was one of the greatest political economists and influential opinion leaders in post-war Japan. He was also the human embodiment of mainstream economics educated at Harvard University in its pre-war golden age, as well as the Marxian tradition of political economy absorbed in pre-war Japan. It was this unique background that enabled Tsuru to be free from any rigid dogmatism. However, the same background made him rather isolated in the academic spectrum of post-war Japan, which was sharply divided into opposing camps, and having a foot in both camps was viewed with scepticism rather than with admiration for flexibility.
Tsuru's academic and social accomplishments were remarkable. They become even more impressive if we recollect that there were many storms in his life, and he was always snowed under with many official commitments that his sense of duty would not allow him to avoid. Aside from his services rendered as a Member of the Science Council of Japan, as well as at Deliberation Councils of the Japanese Government, his post-war career contained the following commitments. He served as the Programme Committee Chair of the Economic Stabilization Board from June 1947 to April 1948. It was as an integral part of this duty that he took the initiative in writing the famous Report on the Economic Reality of Japan,Footnote1 which was the first White Paper ever written in Japan. It was one of the most informative, influential and readable government reports ever published in Japan. After he resigned from the Economic Stabilization Board, he was appointed in September 1948 as Professor of the Institute of Economic Research, Tokyo University of Commerce, which soon became Hitotsubashi University, where he served as the Director of the Institute of Economic Research over many years (1949 – 56; 1965 – 7). He was subsequently elected President of Hitotsubashi University in April 1972, in which capacity he served until March 1975. In August 1977, he was inaugurated as President of the International Economic Association, a position he held for three years. His already busy life could have been even busier if he had not declined the request to become Minister of Education in Mr Takeo Miki's Cabinet, or to stand as the Socialist Party's candidate for the Governorship of Tokyo.
Before discussing his academic accomplishments, the essence of which may be found in his Collected Works,Footnote2 let us have a brief look at his early personal history.
Shigeto was born in Tokyo on 6 March 1912. In 1917, his family moved to Nagoya. His health was always a serious concern, which forced him to miss some of the early years of elementary education. When Shigeto was in the second year at a middle high school, his father asked a native English speaker to teach Shigeto English grammar and conversation once a week at home. Shigeto's extraordinary command of English originated from these home tutorials. In 1929, Shigeto entered a high school under the old system, but he never completed his high school education in Nagoya. Although he had excelled in many frontiers including an English Speaking Society as well as track and field meets, he was expelled from the high school for his radical political involvement that led to his arrest on 2 December 1930. The processing of his arrest and expulsion was very harsh, as he was not allowed to continue his higher education in Japan.
Shigeto's father quickly acted so that he could pursue his higher education in America. In January 1931, Shigeto arrived at Lawrence College in Appleton, Wisconsin. After two years there he made a decision to transfer to Harvard College for his final undergraduate years, and then to Harvard University. It was at Harvard that Shigeto encountered life-long teachers of the highest academic calibre such as Frank Taussig, Joseph Schumpeter and Wassily Leontief. He also developed a close friendship with young and brilliant scholars such as Paul Samuelson, Paul Sweezy and Robert Triffin. Characteristically, Samuelson recollected this period as follows:Footnote3
Harvard did much for us. But … we did much for Harvard too. Tsuru in particular brought to that rather complacent citadel of mainstream economics, a knowledge of and an interest in Marxian economics. Paul Sweezy's The Theory of Capitalist Development, which still serves as one of the best expositions of Marxian economics for economists trained along mainstream lines, was written at Harvard in this period. Tsuru's appendix to the book, relating the steady and expanded reproduction tableau of Marx to Quesnay's tableau economique and to Leontief – Keynes' circular flows, occupies a permanent place in the history of economic doctrines.
Herbert Norman was a Canadian historian with whom Shigeto developed a close friendship at Harvard. Norman was born in Japan in September 1909. His parents were Methodist missionaries stationed in Japan since 1901. After completing an MA in Ancient History at Trinity College, Cambridge University, Norman came to Harvard in 1935, where he met Shigeto. They found a common interest in the development of the modern state in Meiji Japan. Norman completed his MA and PhD in Japanese History at Harvard and he returned to Japan in 1940 as an employee of the Canadian Department of External Affairs. His next encounter with Shigeto was under extraordinary circumstances.
In the meantime, Shigeto also completed his PhD dissertation on ‘Business cycle theories and their application to Japan’ in June 1940. The empirical part of his dissertation was soon published in the Review of Economic Statistics.Footnote4 Sweezy's book was published in 1942 with Shigeto's aforementioned appendix entitled ‘On reproduction schemes’. Shigeto found a teaching job at Harvard, and was entrusted to take responsibility for a seminar on Marxian Economics with Sweezy. Thus, life appeared to be very pleasant for Shigeto and his wife, Masako, whom he had married in June 1939. However, an unprecedented calamity was about to fall on the whole world, which disrupted Tsuru's blossoming career substantially.
On 7 December 1941 war broke out between America and Japan. According to Shigeto's own recollection in his Autobiography,Footnote5 he soon arrived at a personal conviction that Japan could not possibly win this war against America. This conviction was partly based on his conversation with Harry Dexter White (1892 – 1948) whom he knew since his old days in Lawrence College. It was Shigeto's personal conviction about this that encouraged him to return to Japan in order to contribute to the resurgence of his mother country after the inevitable defeat. The opportunity to fulfil this desire came abruptly. It was on 1 June 1942 that he received a telegraph from the State Department that offered Mr and Mrs Tsuru repatriation as part of a war exchange between America and Japan. They had only five days before entrusting themselves to the authorities in charge, so that Shigeto had to dispose of almost all books and documents in a hurry. He put aside all his books on Japanese economic history for Norman to collect later. Samuelson was another recipient of his books, who related this episode as follows: ‘During the war, Shigeto was evacuated to Japan. When he had to dispose of his books, I was the lucky recipient of his copy of the 1932 edition of Pigou's Economics of Welfare, which I read carefully.’Footnote6
A Swedish merchant ship, Gripsholm, carried 1,500 repatriated Japanese to Lourenço Marques in Portuguese East Africa,Footnote7 where they were exchanged for those who had been likewise repatriated from Japan. Among those who embarked on Gripsholm were a famous mathematician returning from Princeton, Shizuo Kakutani, and a seven-year-old boy who later became an econometrician with a worldwide reputation, Takeshi Amemiya. They then embarked on a Japanese merchant ship, Asama Maru, which brought them back to Japan in August 1942.
When the two sides of repatriated people passed each other in Lourenço Marques, Shigeto found Norman on the other side. According to Shigeto's Autbiography, he found a few brief seconds to tell Norman how he could locate Shigeto's books on Japanese economic history at Harvard. Nobody knew then that this would lead to a terrible tragedy much later.
It arose in 1956 during Shigeto's visit to Harvard, where he taught two courses, one on comparative economic development and the other on socialism, the latter being jointly taught with Jan Tinbergen. Shigeto was summoned to the US Upper House to make a statement. Despite an official statement by the Canadian Government to the contrary, Norman was under suspicion of having communist sympathies during his diplomatic activities. Shigeto believed that the purpose of the summons was to inquire about his relationship with Norman so as to substantiate this suspicion. Part of the background of this surmise had been a radio news item to the effect that Norman had tried to retrieve some ‘secret documents’ which Shigeto had left behind at the time of his repatriation. Shigeto thought that he could clear up this allegation by pointing out what had actually happened. However, the purpose of this summon turned out to be more about Shigeto's own involvement in communism. To make matters even worse, Norman committed suicide in Cairo on 4 April 1957, just a few days after Shigeto's statement. Despite his intention to clear Norman from suspicion, Shigeto was condemned by the Japanese mass media for providing a confession at the expense of his close friend. The fact that the accusation against Norman was subsequently proved to be groundless provided little relief for Shigeto.
Tsuru's academic contributions to economics are numerous and range over many areas, but there are three areas of research that may be singled out.
The first area is the critical examination of the methodology of economic aggregates. The quintessence of Tsuru's work in this area is contained in his book in Japanese, National Income and Reproduction Schemes (1951, Tokyo: Yuhikaku), which was later republished in the first volume of the Collected Works. In Tsuru's self-evaluation, this book was his major initial work in theoretical economics. Tsuru's teacher at Harvard, Joseph Schumpeter, known for his scepticism against Keynes' use of economic aggregates, instructed young Tsuru to examine the methodology of Keynes' use of aggregative concepts vis-à-vis that of Marx. This book, which may be construed as Tsuru's belated progress report submitted to Schumpeter, may be summarized as follows. Any aggregative concept can play an active role in economic analysis if and only if it has a theoretical significance of its own. In other words, an aggregative concept is meaningful if and only if it can play an indispensable role as a building block of an objective economic law, unimpeded by any outside interference. It is worthwhile to recollect that the use of aggregative concepts by classical authors such as François Quesnay, Nassau William Senior, John Stuart Mill and Karl Marx was precisely in this sense. In sharp contrast, the use made of aggregative concepts by John Maynard Keynes was not as an instrument of an objective economic law, but as an instrument of state control of the working of an economic system. To substantiate this claim, Tsuru cited a passage from Keynes' General Theory:Footnote8‘Our final task might be to select those variables which can be deliberately controlled or managed by central authority in the kind of system in which we actually live.’ According to Tsuru, this change of stance in the use of economic aggregates was brought about by the systemic dysfunctioning of the competitive market mechanisms in the 1930s. To the extent that the barometric function of prices became less reliable as the market imperfections became conspicuous, Keynes' use of economic aggregates had to be accepted as a means to complement the unsatisfactory performance of market mechanisms. This leads to a serious question. In the case of traditional microeconomic theory, there is a basic principle of constrained optimization that enables the derivation of the basic functional relationships – such as demand and supply functions – among economic variables. What, then, is a basic principle which underlies the statistical functional relationships – such as the statistical consumption function – among statistical aggregates? Tsuru posed this important question, but he left it unanswered. All he did was to call the reader's attention to what is now known as the microeconomic foundations of macroeconomics.
Tsuru's second major area of research was comparative economic systems and institutions. His work in this field may be represented by the book he edited, Has Capitalism Changed? An International Symposium on the Nature of Contemporary Capitalism (1961, Tokyo: Iwanami Shoten). This was a collection of papers by John Strachey, Paul Sweezy, Charles Bettelheim, Maurice Dobb, John Kenneth Galbraith, Paul Baran and some others, each one trying to answer the questions posed by Tsuru on the recent changes in American capitalism, their theoretical implications, and the expected transition path towards socialism. It is often mentioned as the most important post-war work on the comparative analysis of capitalism versus socialism. Compared with the socialist planning controversy in the 1930s,Footnote9 which was fought between Ludwig von Mises, Friedrich von Hayek and Lionel Robbins, on the one hand, and Oscar Lange, Maurice Dobb and Paul Sweezy, on the other, and focused on the theoretical possibility of rational economic planning under socialism, there are two conspicuous differences which are worth pointing out. The first is that the Tsuru Symposium consisted solely of scholars who were critical to capitalism to begin with, whereas the socialist planning controversy in the 1930s was fought between the two camps with sharply contrasting stances towards capitalism versus socialism. The second is that the controversy in the 1930s was focused on the theoretical possibility of rational socialist planning, whereas the Tsuru Symposium was focused on the concrete reality of American capitalism and its possible transition towards socialism. These features are intrinsic in Tsuru's approach to comparative economic systems and institutions.
Tsuru's third major area of research was environmental disruption and the design of economic policies to cope with this problem. His work in this arena may be represented by his two books, viz., The Political Economy of Environmental Disruption (1972, Tokyo: Iwanami Shoten, in Japanese) and The Political Economy of the Environment: The Case of Japan (1999, London: Athlone Press) but his strong concern about environmental disruption dates back at least as far as 1950. In an essay entitled ‘Reflections of an economist’, which was originally published in 1950 and republished in the Collected Works, Tsuru maintained that if an economist cannot meet the challenge of environmental disruption, he should not be called an economist, who studies real economic problems; he should rather be called a scholar on economics, who preaches or interprets a doctrine of economics established by somebody else. Faithful to his own words, Tsuru started his serious effort to face environmental disruption in 1963. The first step of his strenuous effort was to organize a study group on environmental disruption, which originally consisted only of seven members, and investigate the actual circumstances of such notorious pollution cases as the Yokkaichi asthma case and the Minamata disease case. This study group eventually grew into the Society for Environmental Economics and Policy Studies, whose membership now exceeds 1,200. There were also many policy proposals by Tsuru's study group that were successfully incorporated into actual policies and institutions in Japan. Another notable feature of Tsuru's study on environmental disruption is that he was free from the dogmatism that prematurely and blindly imputes the cause of environmental disruption to the capitalist economic regime. Indeed, Tsuru's The Political Economy of Environmental Disruption started from the pollution of Lake Baikal under the USSR regime. It was a scientific analysis of the causal link between environmental disruption and underlying economic regime rather than the dogmatic faith in the cause of socialism that led Tsuru to go beyond the market mechanism in his search for effective measures against environmental disruption.
In closing this part, I need to mention Tsuru's expositional ingenuity, which he amply exhibited in lectures as well as writings. This ingenuity was best exhibited in his introductory expositions for novices and the man in the street. The best example can be found in his small book called Economics without Tears (1974, Tokyo: Kodansha, in Japanese). A phrase that naturally came to my mind when I first read it was the following:Footnote10‘What oft was thought but ne'er so well expressed’. It is no wonder that this book occupied the central position in the first volume of Tsuru's Collected Works.
What lies at the heart of Tsuru's work may be best illustrated by his favourite passage from John Ruskin:Footnote11‘There is no wealth but life.’ It was his strong concern for human well-being that led Tsuru to criticize the use of national income as an index of well-being. It was also the same concern that led him to emphasize the relevance of the Fisherian stock concept rather than the Keynesian flow concept. Although he was critical of many aspects of the capitalist economic regime and retained his faith in the idealized socialist economic regime, his strong desire to contribute to the promotion of human well-being prohibited him from shutting his eyes from environmental disruption in the Soviet Union. I cannot but think that he was a life-long practitioner of welfare economics along the line of Arthur Pigou who wrote as follows:
The complicated analyses which economists endeavour to carry through are not merely gymnastic. They are instruments for the bettering of human life. The misery and squalor that surround us, the injurious luxury of some wealthy families, the terrible uncertainty overshadowing many families of the poor – these are evils too plain to be ignored. By the knowledge that our science seeks it is possible that they may be restrained. Out of the darkness light!Footnote12
Notes
∗ Shigeto Tsuru was among the three examiners who interviewed me when I applied in the mid-1960s for the Graduate School of Economics at Hitotsubashi University. In addition, during my study at the Graduate School, I took two courses he taught, one of which involved the welfare-theoretic implications of national income. However, I should not be counted as his disciple in the traditional sense of the word. I am most grateful to Heinz Kurz who encouraged me to write this essay. Thanks are also due to Walter Bossert, Konosuke Odaka and Miyohei Shinohara for their encouraging comments on the earlier draft of this essay.
1 Tsuru, S. and Ohkita, S. (1947). Report on the Economic Reality of Japan. Economic Stabilization Board, Tokyo: Japanese Government. In Japanese.
2 Ito, M., Odaka, K., Takasuka, Y., Hanayama, K. and Miyazaki I. (eds) (1975 – 6). The Collected Works of Shigeto Tsuru, 13 vols. Tokyo: Kodansha. Among these volumes, the first 12 volumes are in Japanese, whereas the last volume, which is titled as Towards a New Political Economy, gathers some of his representative publications in English. In Tsuru's own words, ‘[i]t would have been more accurate to use the title of “Selected Writings” inasmuch as [his] past writings, if assembled all together, would fill about forty volumes of a 500 pages length for each.’ It should also be emphasized that Tsuru's writing activities did not end with the publication of these Collected Works. Quite the contrary, 20 books were published after the completion of the Collected Works, among which I list only those books written in English: Institutional Economics Revisited (1993, Cambridge: Cambridge University Press); Japan's Capitalism: Creative Defeat and Beyond (1993, Cambridge: Cambridge University Press); Economic Theory and Capitalist Society (1994, Aldershot: E. Elgar); The Economic Development of Modern Japan (1996, Aldershot: E. Elgar); The Political Economy of the Environment: The Case of Japan (1999, London: Athlone Press).
3 Samuelson, P.A. (1977). Reminiscences of Shigeto Tsuru. In H. Nagatani and K. Crowley (eds) The Collected Scientific Papers of Paul A. Samuelson, vol. 4. Cambridge, MA: The MIT Press, pp. 897 – 902.
4 Tsuru, S. (1941). Economic fluctuations in Japan, 1868 – 1893. Review of Economic Statistics, 23: 176 – 89.
5 Tsuru, S. (2001). Autobiography: In Retrospect of Several Points of Bifurcation. Tokyo: Iwanami-Shoten. In Japanese.
6 Suzumura, K. (2005). An interview with Paul Samuelson: welfare economics, ‘old’ and ‘new’, and social choice theory. Social Choice and Welfare, 25: 327 – 56.
7 This place is now known as Maputo in Mozambique.
8 Keynes, J.M. (1973). The General Theory of Employment, Interest and Money, vol. VII of The Collected Writings of John Maynard Keynes. London: Macmillan, p. 247. Originally published in 1936.
9 Those who are interested in the socialist planning controversy in the 1930s are cordially referred to Suzumura, K. (2002) Introduction. In K.J. Arrow, A.K. Sen and K. Suzumura (eds), Handbook of Social Choice and Welfare, vol. I. Amsterdam: North-Holland, pp.1 – 32.
10 Pope, A. (1732 – 34). In J.C. Collins (ed.) Pope's Essay on Criticism. London: Macmillan, 1896, Part ii, lines 97 – 8.
11 Ruskin, J. (1994). Unto This Last. London: Routledge/Thoemmes, p.166. Originally published in 1862.
12 Pigou, A.C. (1952). The Economics of Welfare, 4th edition. London: Macmillan, p. vii.