Suppliers’ Associations in the Japanese Automobile Industry: Collective Action for Technology Diffusion

This paper analyzes the structure and functions of suppliers’ associations (kyoryokukai) in the automobile industry in Japan. The bilateral assembler-supplier relationship has received much attention recently as a source of Japanese industrial competitiveness. However, this paper argues that the hitherto neglected area of inter-supplier coordination in technology diffusion is at least as important as the bilateral assembler-supplier relationship in accounting for the overall performance of the Japanese automotive industry. On the basis of company visits and a large-scale survey of first-tier suppliers conducted by the author, the paper analyzes the reasons why suppliers’ associations were established, why they continue to exist today, and their effects on economic performance. Journal of Economic Literature Classification: L14, L22, L23, L62, N65, O32