It was a great modern achievement for Japan to create a democratic political system, but their economic success as an industrial and capitalist nation is even more impressive. Once the Japanese were known as fanatic soldiers but now they known as successful businessmen. For hundreds of years, the Japanese have displayed personal characteristics, which helped them modify their feudal system to a capitalistic one. Furthermore, the Japanese had institutions, which were easily converted to a capitalist system. Because of these two features, Japan became the first Asian country to successfully adopt democracy and capitalism.

The Japanese showed many characteristics, which contributed to their modern economic success. One example is their tendency to work hard. Also, most of the people have a formal education. Another trait was the painstaking effort they displayed in their workmanship and their skill in mastering difficult crafts and technologies. Even though most of the new methods of industries were introduced relatively late, Japanese learned quickly. Soon they mastered the science of water control systems and transplanting rice shoots for paddy-field cultivation. Furthermore, Japanese swords had become one of the finest swords in the world by the twelfth century. From Chinese's paintings and other fine arts were rapidly absorbed with amazing speed and skills.

In the sixteenth century, the Portuguese became a trading partner with Japan, and during that trade, Japanese rapidly adopted what interested them the most in Western technology, which was the guns. In 1542, muskets were being produced in great numbers and sometimes with slight technical improvements with two decades and were used successfully in battle by massive bodies of musketeers as early as 1575.

For more than two centuries, the Japanese were isolated from the rest of the world, which made Japan fall behind the scientific and age the early phases of the industrial revolution. However, because the Japanese had such unique talents, The Japanese were able to rapidly observe the technology of the West and learned to produce machine made goods of comparable quality to those of the foreigners.

The Japanese entered the new modern age not only with admirable work habits, but they also had great institutions, which helped them to develop their new skills and talents. The Japanese were able to change their feudal structure to a sophisticated modernized marketing system. Under the Tokugawa, all the feudal lords were forced them to create more products, which helped Japan to grow the stronger economic system inside their own country. Before the Tokugawa, Japan was isolated from different states, which created feudal system. However, after Tokugawa, he created a basic concept of the modern government structure. This new system provided system similar to free enterprise. This made the prices to fluctuate, which created competitions. Under this system, Osaka and Edo became the twin economic capitals of Japan. After few changes, new business came in to play such as commercial banking, and manufacturing. In the seventeenth century, the feudal kingdoms became family, which grew in numbers and spread all around the Japan. These new family businesses included, sake brewing, dry goods retailing, and banking. Also, financial institutions were well developed, and major retail stores developed fixed prices.

The ownership of large family was passed down from generation to generation, but management was gradually transferred to head clerks. The relationship between the head clerks and the owners became stronger. Since they had such a strong relationship, it became extended family, where they built a strong sense of mutual loyalty between employers and employees.

During late eighteenth and early nineteenth centuries, the merchants and entrepreneurs drove to the big city, which helped Japan to prepare for the modern age of international business. Samurai class was one of the most influential when the feudal system was destroyed; they had to fin another way to earn money. With the help from the government, many samurais succeed in the fields of manufacturing, banking and trades. Some of samurais already had business experience under the old system. As warriors, many samurais had manage the warehouse, transportation, and sale of their kingdoms of goods.

One example of samurai businessman was Ewasaki Yatayo of Shikoku, who started the great Mitshibishi Company, which became one of the most successful business in the modern Japan. However, not all the samurais became successful businessman and many failed miserably. Never the less, more of the new economic success came from samurai class than the peasants or merchants.

Even though Korea and China had similar talents and skills as the Japanese, including diligence, craftsmanship and commercial organization the Japanese were while to adopt the western culture more effectively. The main reason why they were able to become more successful was, Japanese attitude was more open to the westerners and they wanted to modernize their economy as fast as they could.

While Korea and China were ignoring the outside world and trying to maintain their traditions, Japan was learning new ideas from the west, adopting their economic and political system. For this reason, Japan got a head start on Asian neighbors, which it has maintained to this day.

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