Historical interpretation is a decisive factor in determining the valueand direction of historical research. Taiwan was a Chinese frontierin the 18th and 19th century, and a colony of Japan in the firsthalf of the 20th century. Beginning from the late 19th century,Taiwan has gradually tranformed into a modern economy. Owingto their own belief and knowledge, historians have been attractedby different historical facets. Different approaclies of historical interpretation such as the Chinese frontier approach, the imperialismapproach, and the modernization approach liave thus come out inTaiwanese economic research. These different approaches lead tovery different focus, topics, and contents of research. As a result,studies applying different approaches have produced complementary effects in interpreting Taiwanese economic history. Nevertheless, no matter which approach has been adopted, the past research ignores, more or less, Taiwan's distinctive features. Moreover, the specific approach of historical interpretation applied often becomes a contraint to the research of Taiwanese economic history in tlic choice of topics and depth of research. Finally, adhereing to par ticular approaches of historical interpretation, the researchers often get into subjective judgement when the concepts discussed arc not easily to be defined and estimated, and therefore quite diverse in terpretations have been made for the same historical events.