1. What is the Wanli Emperor Re-evaluation Theory? The Wanli Emperor (reign: 1572โ1620) was the Ming emperor during the Imjin War (Japanese invasions of Korea). Traditionally, he has been seen as the poster child for 'the worst incompetent ruler.' However, recently, some corners of the internet have started discussing re-evaluating Wanli. Several related posts have even appeared on Fmko. They include: (1) 'Who is the greatest emperor in Ming Dynasty history? - 1' (2) 'Who is the greatest emperor in Ming Dynasty history? - 2' (3) 'The Wanli Emperor was totally screwed over, the real reason the Ming fell is... jpg'. This post will briefly examine whether these re-evaluation arguments are valid, focusing primarily on the economic aspects.
2. Before we dive in: Let's review the most fundamental economic concepts. First, before evaluating the Wanli re-evaluation theory, let's look at some very simple basic economic concepts. (1) Taxation fundamentally causes economic inefficiency.
Image Source: https://www.atlas101.ca/pm/concepts/tax-revenue-and-deadweight-loss/ The economic inefficiency caused by taxation is called 'deadweight loss.' The gray area in the image above is the deadweight loss. So, does that mean we shouldn't collect taxes at all since they cause deadweight loss? No. Government tax revenue is essential for defense, welfare, and building social infrastructure. Therefore, taxation is crucial for maintaining society, but since its very existence causes economic loss, imposing taxes must be done carefully. (2) Government finance consists of revenue (income) and expenditure (spending). (3) The primary source of revenue is taxation. (4) Increased revenue is not automatically a good thing. Let's recall the concept mentioned above. The main source of revenue is taxation, and taxation inherently causes economic inefficiency.
Image Source: https://mathphysics.tistory.com/912 Increased taxes definitely have the effect of increasing revenue up to a certain level (*). However, look at the change from (a) to (b) in the figure above. As the tax burden grew, the deadweight loss increased dramatically (remember that area is proportional to the square of the distance). That is, increasing revenue through tax hikes comes at the cost of larger deadweight loss. For an intuitive understanding, letโs consider a hypothetical example. Suppose the National Assembly suddenly passes a law unanimously to increase the income tax rate across all brackets by 30 percentage points starting tomorrow. Revenue will surely increase, but is this situation desirable? Of course, this doesn't mean we should never raise taxes. Plus, government revenue can also increase due to economic revitalization, not just tax hikes. The main point is that simply increasing revenue does not necessarily mean things are economically good. We need to look at why revenue increased. *While there is a theory that excessively high taxes can 'theoretically' decrease tax revenue, covering that would stray from the topic, so I will omit it. (5) An increase in revenue doesn't automatically mean finances are improving. As already mentioned, finance consists of both revenue and expenditure. What if revenue increases, but expenditure increases even more drastically? For example, revenue increases from 50 to 100. But expenditure increases from 30 to 500. Can we say the government's financial situation is good? You might think, 'Isn't this just basic common sense?' Yes, it is all basic common sense. However, Iโm not bringing this up for no reason. Now let's look at the arguments supporting the Wanli re-evaluation theory.
3. 'Government revenue increased, so Wanli achieved the greatest financial success unparalleled in Ming history?' Let's look at the logic behind the Wanli re-evaluation theory.
Source: https://www.fmkorea.com/best/9187557974 (Who is the greatest emperor in Ming Dynasty history? - 1) Summarized, the argument for Wanli's re-evaluation in that post is: 'Since government financial revenue dramatically increased during Wanli's time, as shown in the graph above, the golden age of the Ming Dynasty was under Wanli, and he achieved the greatest financial success unparalleled in Ming history.' The conclusion, frankly, is 'a claim lacking basic economic concepts.' I didn't point out the basic economic common sense in Section 2 for nothing. Letโs reconsider the basic economic concepts we saw in Section 2. (1) A dramatic increase in financial revenue does not necessarily mean the economy is in a good situation. (2) Finance consists of revenue and expenditure. It is difficult to conclude that finances improved based solely on the revenue increase data above. (3) Therefore, it is difficult to discuss government finance and financial achievements based merely on revenue increases. I will introduce a few examples to help you understand.
Image Source: Tai-kuang Ho , Ya-chi Lin and Kuo-chun Yeh, The Borchardt Hypothesis: A Cliometric Reassessment of Germanyโs Debt and Crisis during 1930โ1932, 2022 This shows per capita public financial revenue and expenditure in Germany in the 1930s. Per capita government revenue shows an increasing trend from the early 1930s, recovering to the 1930 level in the late 1930s. However, per capita government expenditure increased much more steeply during the same period, eventually surpassing per capita government revenue. In the situation above, would it be valid to discuss economic performance based solely on per capita government revenue, excluding per capita government expenditure? Let's look at another case.
Image Source: Moon Myung-gi, Comparative Analysis of Revenue of the Government-General of Taiwan and the Government-General of Chosen โ Focusing on General Account Supplements and Public Bonds โ, 2017, p. 249 The revenue of the Government-General of Chosen (Korea) was initially smaller than that of Taiwan, then overtook it, continuing upward until 1938. According to the logic of the Wanli re-evaluation theory, 'Imperial Japan revitalized the finances of the Government-General of Chosen and achieved tremendous success.'
Image Source: Park Woo-hyun, The Fiscal Crisis of the Government-General of Chosen in the early 1930s and the Empire's Discriminatory Response, 2024, p.120 However, the story changes when considering expenditure. Specifically, excluding the funds raised by issuing Chosen Business Public Bonds, the government was in a revenue deficit situation. So, in this situation, is it valid to evaluate Japan's financial performance or revival simply by looking at revenue, as the Wanli re-evaluation theory does? Of course, the evaluation of the economic situation during the Japanese colonial era is extremely complex and goes too far afield from this topic. My point here is that discussing finance and the economy based merely on revenue is utterly absurd. Frankly, you don't even need specialized data; if you consider the basic concepts covered in Section 2, the reasoning presented in the Wanli re-evaluation theory makes no sense whatsoever.
4. Is the Wanli re-evaluation theory actually based on facts? Still, itโs good practice to look at specialized material for fact-checking, so I reviewed some research papers. (1) Was the government's financial situation good during Wanli's time? Professor Seo In-beom openly states this about the Ming finances during Wanli's reign: 'As repeatedly mentioned, the Wanli period was an era of fiscal crisis.' - Source: Seo In-beom, Fiscal Crisis and the Implementation of Donation-Taxes during the Wanli Era of the Ming, 2016, p.201 - Professor Seo In-beom flat out says it was a fiscal crisis.
(2) Did Wanli implement effective fiscal policies? 'As repeatedly mentioned, the Wanli period was an era of fiscal crisis. The official Wang Dewen saw 'frugality' as the most important solution. He requested the reduction of textile production, suspension of construction projects to aid border provisions, halting the purchase of jewels for the comfort of his descendants, careful investigation of purchases to help national expenditures, and rapid progression of major construction to reduce complex costs, but the Wanli Emperor did not respond. The Wanli Emperor should have recognized the fiscal crisis, and furthermore, the crisis of the dynasty, and implemented thorough countermeasures.' - Source: Seo In-beom, Fiscal Crisis and the Implementation of Donation-Taxes during the Wanli Era of the Ming, 2016, p.201-202 - Hmm... Professor Seo In-beom says no.
(3) Is Wanli at least better than Chongzhen? (Omitted)
Source: https://www.fmkorea.com/best/8321631984 (The Wanli Emperor was totally screwed over, the real reason the Ming fell is... jpg) The Wanli re-evaluation theory claims that 'Wanli increased financial revenue, but Chongzhen ruined it all.' Is that true? 'In the late Wanli period, military provisions for the Nine Garrisons amounted to only 2.8 million taels, but by the tenth year of Chongzhen, the steep Liaoxiang tax amounted to 9 million taels, the Bandit Suppression Tax (Chaoxiang) was 3.3 million taels, and the Training Tax (Lianxiang) was over 7.3 million taels.' - Source: Seo In-beom, Finance and Military Procurement during the Chongzhen Era of the Late Ming, 2015, p.154 - Of course, I am not arguing that Chongzhen did a good job. Chongzhen's competence is a separate issue. However, if we apply the Wanli re-evaluation logic directly, Chongzhen would appear far superior to Wanli.
(4) Did Wanli's eunuchs 'carry' the Ming finance and economy?
Source: https://www.fmkorea.com/best/8321631984 (The Wanli Emperor was totally screwed over, the real reason the Ming fell is... jpg) The Wanli re-evaluation theory claims that 'even though Wanli's eunuchs were corrupt, they were financially and economically beneficial.' Is this true?
Image Source: Yoon Sang-hwan, Mining Tax Activities of Chen Zeng, the Shandong Mining Tax Eunuch in the Late Ming, and their Aftershocks, 2012, p.311 'Consequently, Wanli's policies regarding mining and commercial taxes helped obstruct the flow of commerce. (Omitted) Reconsidering this from the national financial perspective, the exploitation caused by the mining tax inevitably resulted in a decline in existing tax revenue, thereby trapping it within structural limitations. Furthermore, the large amounts of gold and silver extorted from the people were sent to the *Inner Treasury* (Naegu), which handled the imperial household's finances, not the *Outer Treasury* (Oegu), which managed state finances. (Omitted) Moreover, not all taxes collected by the tax superintendents were remitted to the inner treasury or the state treasury. (Omitted) As various taxes, including shop rent (Dianzhu), fell into the hands of the eunuchs, the authority of the Ministry of Revenue (Hubu), which oversaw finances, was weakened, leaving the state unable to secure even its normal fixed revenue (omitted).' - Source: Yoon Sang-hwan, Mining Tax Activities of Chen Zeng, the Shandong Mining Tax Eunuch in the Late Ming, and their Aftershocks, 2012, p. 310-312 According to Yoon Sang-hwan (2012), the eunuchs' exploitation actually damaged commerce and negatively affected state finances. Massive store closures due to eunuch exploitationโhow is that an economic achievement? The extorted taxes weren't even all returned to the state treasury.
(5) Were the finances solid under Wanli?
Source: https://www.fmkorea.com/best/9195175233 (Who is the greatest emperor in Ming Dynasty history? - 2) The Wanli re-evaluation theory claims that the state didn't collapse because of the strong national treasury during his reign. Is this truly the case??
Image Source: Seo In-beom, Fiscal Crisis and the Implementation of Donation-Taxes during the Wanli Era of the Ming, 2016, p.161-163 According to Professor Seo In-beom, the budget was in deficit throughout Wanli's entire reign. The state treasury was never solid in the Wanli period.
(6) Did Wanli manage finances effectively?
"A 'thesis-level' rebuttal! Users are grabbing popcorn to watch the debate, while others drop the classic meme: 'If you're Korean, you gotta support Wanli!'"
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