This post is typed verbatim from Keys to the Japanese Heart + Soul, an excerpt from Japan: An Illustrated Encyclopedia.
(character, turn of mind, spirit). An important concept in Japanese popular psychology. The word originally meant a wooden board with carved designs used to print designs on paper and cloth. It later came to mean customs and habits and, eventually, the spirit, traits, or mind-set common to members of an occupational, age, or status group. Stories describing the katagi of members of various social categories (such as mistress, merchant, student, and farmer) constituted a genre (katagi-mono) of popular literature in the Edo period. Katagi among artisans (shokunin katagi), for example, was characterized by a fastidious devotion to work and pride in their product, to the point of ignoring profit. It also implied the artisan's lack of social tact, his indifference to complicated interpersonal relations, and his honesty and naivete.