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Hello, you may be familiar with Japan’s economic miracle after World War Two, but did you know that the first economic miracle actually took place in the 12th century, that is when Japan became the only medieval society in the world, to monetize its economy with the help of foreign coins, more precisely Chinese copper coins, like the ones I am holding right here. But why would society that was based on rice and silk as barter suddenly import China’s currency? Well, these coins were originally imported by traders for its copper to make various implements. Once available, however, merchants became using them in transactions, and within just over one century, Japan has been cash based, so in sharp contrast to European medieval economies, Japan monetized without minting a single coin of its own. What do we learn from this? Above all, it shows that there were different patterns of economic development, and that the crucial players here were Chinese and Japanese traders rather than governments. Without them, the coins would have never reached Japan and Japan would never have experienced its first economic miracle.
