In 2013, as Japanese monetary authorities under the banner of “Abenomics” begin working to create yen means of payment in immense volume, the question of the international use of the yen seems likely to resurface. This question has been asked, on and off, for the past three decades, usually framed in the form: Why hasn't the yen become an international currency? In fact, the yen once was an international currency, and Michael Schiltz's new book tells how that situation came to be.

This excellent book, which is based on extensive use of Japanese-language sources, offers the first English-language study of the origins of the pre-World War II yen bloc in East Asia. It is at once a study of financial diplomacy, imperialism, monetary policy, and the national specificity of economic ideas. It provides significant new material on the histories of Korea, Taiwan, and China. It also represents a major contribution to the burgeoning literature on “money doctoring,” which has had an almost exclusively Western (and mainly U.S.) focus. The presentation is energetic and lucid, accessible to those new to the subject while also being fascinating to specialists.

The literature on “money doctors” provides an immediate context for this book. Paul Drake's pioneering study (The Money Doctor in the Andes?: The Kemmerer Missions, 1923–1933?, Duke University Press, 1989) focused on interwar U.S. projects to institute “independent” (meaning externally dependent) central banks and dollar-linked monetary systems on the west coast of South America in the 1920s. My own research has explored how attempts were made to apply similar medicine to Japan during the same period, with disastrous consequences that provoked a sharp reaction against Anglo-American style “globalization.” Emily Rosenberg's sweeping study (Financial Missionaries to the World: The Politics and Culture of Dollar Diplomacy, 1900–1930, Harvard University Press, 1999) described some of the historical origins of this practice in America's new formal and informal empires in the years after 1898. Schiltz has now explored in detail a parallel series of Japanese money-creation enterprises in Northeast Asia, which developed quite simultaneously with U.S.-directed monetary reforms in the Caribbean, the Philippines, and elsewhere.

The book consists of four substantial chapters. The first recounts the founding of a central bank and establishment of a yen-based monetary system in Japanese-occupied Taiwan. Along the way, Schiltz provides an excellent background account of the monetary situation in late nineteenth-century Taiwan. Indeed, many of the book's original insights are to be found in the many background stories and in the skillful interweaving of local and macro-level questions. The second chapter, 60 pages long, makes an important contribution to the history of monetary reforms in Korea before the Japanese occupation and during the “financial occupation” directed there by the Japanese official Megata Tanetarō. It describes a process even more significant for Korean history than for Japanese history. This is also an exceptionally complicated story, and Schiltz has done a great service by working it out and making it available to the world. The story of the World War I-era “Nishihara loans” in China, the subject of chapter 3, is better known in the English-language literature, but only in outline. Here we are given a much more detailed account, presented in the context of the history of Japanese investment in China. The fourth chapter opens up another big subject that has been unexplored in English-language work, examining a long-running series of debates over how to impose a Japanese monetary standard in Manchuria (Northeast China). Many of these questions turn out to have been surprisingly central to the political and economic constitution of the Japanese empire as a whole.

Money creation, and the power politics involved in it, are at the heart of this study. Yen-based money creation did not translate directly into access to foreign-exchange currency, but it did serve as leverage internally, as a tool for extracting labor and material resources from a large, densely populated region. Doubtless, these Japanese-administered money-creation systems were also, during periods of relative economic stability, a tool for general economic development. Of course, this development was primarily organized to serve Japanese interests rather than local ones. During the “Greater East Asian War,” as it was officially called in Japan, this form of monetary expropriation of Asian resources via the creation of “inflation capital” reached an extreme. Schiltz thus concludes that “the new generation of Japanese money doctors became the financial counterparts of the infamous Nazi death-camp doctors” (p. 217).

The Money Doctors from Japan is not a total history of the yen bloc—there is much more to say about that, and we would need two or three further English-language studies of the scope and scale of Schiltz's in order simply to describe the lay of the land, including the system's peacetime functioning, its wartime hyperexpansion, and its wartime hyperinflationary denouement. The postwar legacies of Japan's prewar international financial management, for Japan and the region, also remain to be explored, as Schiltz indicates. Schiltz's own conclusion is that it is “not only possible but also desirable” for Japan to play a more active and constructive regional financial leadership role. However, “the ghosts of the prewar money doctors continue to haunt [this] scenario” (p. 226). Schiltz's study thus aims to help turn a new page.