Japanese business culture: the government,mainstream enterprises and ‘mavericks’ in the steel industry

Some scholars have argued that Japanese business epitomizes organized capitalism, and no-one would deny that the government and trade associations were pivotal in the distinctive development of Japanese capitalism. But it is frequently emphasized that competition between firms was fierce. One interpretation is that Japanese firms co-operated in developing technologies, and also collaborated in pricing policy, output allocation and capital investment. This collaborative endeavour gives the impression of a business environment that was static and collusive. By contrast individual firms competed aggressively in the improvement of the product quality, in productivity and in marketing. Infrequently a few determined firms refused to follow government guidance and openly challenged it. Two examples, Kawasaki Steel in 1950 and Sumitomo Metal in 1965, require a wider perspective than business-government relationships. It is the triangular matrix of government, mainstream firms, and ‘mavericks’ that has to be considered. Mainstream firms have a close relationship with government and try to impede the aggressive behaviour of ‘mavericks’. Exploring these tripartite interactions is crucial to any understanding of Japanese industry.