NRI Papers
No.75   Apri 1, 2004
  Strengthening the Competitiveness of Local Industries:The Case of an Industrial Cluster Formed by Three Tokai Prefectures  
Yoshihiko IWADARE
       Efforts to form "industrial clusters" are now under way in various regions of Japan. While many of them involve affiliations between industries and academia, such linkages alone face limitations in creating an industry. This paper uses the case of an industrial cluster formed in three prefectures (Aichi, Mie and Gifu) in the Tokai region in an attempt to offer suggestions with respect to efforts aimed at creating industrial clusters in the future.
       The three Tokai prefectures are home to industries that have high market shares worldwide, such as automobiles and machine tools, and which already constitute one of the most successful industrial clusters in Japan. Manufacturing activities are backbones of the local economy, and a number of industries and companies with high market shares have clustered in this region.
       Within the industrial clusters in the three Tokai prefectures, there are many businesses that have long histories and which have survived to date by adjusting their format and contents to meet the requirements of each relevant era. Value chains are almost fully completed within the region, and technological innovations to improve competitiveness have moved forward. Furthermore, current successes have been achieved by envisioning new-generation industries and incorporating the technologies necessary for them.
       As the product-manufacturing environment becomes increasingly severe in Japan, a new scenario of growth needs to be formulated by new businesses and new industries. While active approaches towards the development of new technologies have been taken in the three Tokai prefectures, focusing on the development of individual element technologies will limit the potential for growth as an industry. What is required is to create ideas for next-generation industries and to bring them to fruition.
       In order to create future industries, this paper proposes the following: (1) approaches to the creation of new industries through a combination of technologies; (2) the development of applications through technological solutions; (3) rolling out businesses based on the results of verification tests in leading technologies; (4) fostering industries through the commercialization of leading technologies; (5) establishing local brand concepts; and (6) soliciting new company participation to enable value chains to be established. It is only when the government establishes mechanisms for these activities and the industrial world plays a leading role in rolling out such activities that the creation of new industries can be realized.
I Three Tokai Prefectures as a Successful Industrial Cluster
II Economy of Three Tokai Prefectures Continues to Support Stable Development
  1 Three Tokai Prefectures Attracting Increased Attention
  2 Local Economy Supported by Product Manufacturing
  3 Concentration of Top-Share Companies
  4 Economic Growth through Innovations
III History of Creating Industries to Meet the Times
  1 Genealogy of Technologies and Industries: Creating New Businesses by Keeping Up with the Times
  2 Development through a Combination of Technologies
  3 Completing Value Chains within a Region
IV Problems and Responses for Further Development
  1 Need for Creating New Industries and Tapping New Markets
  2 Approaches Currently Taken for the Creation of New Industries
  3 Needed Mindset to Develop Concepts of Next-Generation Industries
V Building the Mechanisms for the Creation of New Industrial Clusters
  1 Approaches to the Creation of New Industries through Combinations of Technologies
  2 Development of Applications through Technological Solutions
  3 Rolling Out Businesses Based on the Results of Verification Tests of Leading Technologies
  4 Fostering Industries through the Commercialization of Leading Technologies
  5 Establishing Local Brand Concepts
  6 Soliciting New Company Participation to Enable Value Chains to be Established


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