Four years ago my wife and I decided to take our son to a special and slightly unusual restaurant to celebrate his birthday. We were in Tokyo at the time and gave the taxi driver what we thought was the address for the restaurant – it had names and numbers on it. Cabbies in Tokyo, and in Japan in general, are renowned for their courtesy, the cleanliness of their cabs, and their driving skill. We were very surprised, therefore, when our driver suddenly pulled over and told us that “the restaurant is somewhere around here,” let us off, and drove away.

After several minutes of search, we did manage to find the restaurant around the corner about a block or so away. We had a great meal, but the memory of that experience has always been something of a puzzle – until now.

This summer we returned to Tokyo for a family vacation, and while relaxing in our hotel room I found myself thumbing through a guide book we had brought along, Japan Made Easy, in which I found this startling statement: “Tokyo … has thousands upon thousands of streets, but fewer than one hundred of them have names.” A quick check of Google Maps seems to confirm this assertion. (Hat tip to Jeremy Sapienza).

More than One Way to Address a Letter

This raises some obvious questions, such as how one addresses a letter. The guide says:

…[T]he addressing system in Japan has nothing whatsoever to do with any street the house or building might be on or near. Addresses are based on areas rather than streets. In metropolitan areas the “address areas” start out with the city. Next comes the ku, or ward, then a smaller district called cho, and finally a still smaller section called banchi.

This is not simply an alternative but equally objective addressing system to what we have in the United States. For example, according to the guide: “Prior to a reformation of the addressing system in Tokyo in the 60s, there was one notorious banchi that had over one-hundred buildings on it, all with exactly the same address.”

So, at the banchi level it’s up to the mail carrier to figure out where to drop off a particular letter or parcel, presumably using his experience or rules of thumb learned from other carriers. Of course, it’s not just mail carriers who confront this problem but also, or perhaps especially, people new to town who are trying to find an address for the first time. I imagine even local residents face something of a challenge.

(I think I read somewhere, although I can’t swear by it, that Amsterdam was the first city to use the modern street numbering system that most of us take for granted today.)

Rationality and Local Knowledge

I suppose some might say that this is not an efficient system, and indeed the present (somewhat reformed) system is the legacy of Japan’s relatively recent medieval past. Nevertheless, it’s probably more than simply inertia that keeps people from changing it. It seems to work pretty well. That is, it’s rational from the perspective of those who dwell in the system.

No one would question the economic vibrancy of Tokyo. Mail and goods do get delivered and millions of people do daily navigate their way around an amazingly complex maze of typically alley-sized streets. And while Japan has been mired in the economic doldrums for many years now, you can’t blame the addressing system for that. It’s the same system they had during the boom years of the 1980s.

In his famous essay, “The Use of Knowledge in Society,” Friedrich Hayek argued that “local knowledge” or “particular knowledge of time and place,” such as rules of thumb or skills learned by doing, is more important than the kind of knowledge that can be written down and objectively conveyed (which is why large-scale central planning is impossible).

But what’s local knowledge in one time and place may be quite different in another time and place.

In some cultures, such as ours, it’s important even in mundane matters to get the precise details of location objectively stated. In Japanese culture it’s also important to have those details, otherwise mail would never get delivered properly. But the points of reference remain more subjective. In Japan one navigates the streets by using landmarks and by feel. To quote one of my wife’s favorite lines from the movie Broadcast News: “I’ll see you, you know, at the place by the thing where we met that time.”

When in Tokyo, Stay at a Landmark Hotel?

What works in Tokyo, of course, would cause chaos in New York because the context of norms and expectations are subtly different. On the other hand, the Japanese are far more explicit and picky about what gifts to take when visiting someone on a particular occasion than we are, but we somehow manage to get things right in the end. And it’s probably the case that whatever complex set of norms that says it’s okay for Japanese cabbies to let passengers off only approximately at their destination also reinforces their compulsion for cleanliness and courtesy.

So despite the rather abrupt end to our taxi experience earlier that evening four years ago, we still took it for granted that the ride back later to our digs, the famous Imperial Hotel near the Imperial Palace in central Tokyo, would be very pleasant – and right to the door.

Sandy Ikeda is a professor of economics at Purchase College, SUNY, and the author of The Dynamics of the Mixed Economy: Toward a Theory of Interventionism. He is a member of the FEE Faculty Network.

This article was originally published on FEE.org. Read the original article.