Maximizing U.S. Interests in Science and Technology Relations with Japan (1997) / Chapter Skim
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2 Science, Technology, and Innovation in Japan
2 Science, Technology, and Innovation in Japan
Pages 26-44
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From page 26... ...
The government's control over trade andforeign direct investment allowed a coordinated industry-government approach to obtaining technology from foreign companies in exchange for limited market access and licensingfees. · The acquisition, effective adaptation, and improvement of technologies from abroad by Japanese industry served as the basis for Japan's rapid economic growth and international competitiveness in a wide variety of manufacturing industries.
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From page 27... ...
lapan's industrial and technological development accelerated through the early twentieth century. Extensive importation of foreign technologies continued, with important transfers occurring through the formation of joint ventures and other direct investments by foreign multinational corporations such as Western Electric, General Electric, and Ford Motor Company.5 At the same time, the Japanese industrial sector was growing and evolving rapidly, with the spread of modern management and the emergence of large-scale corporations.6 The zaibatsu, such as Mitsui and Mitsubishi, developed from an initial focus on nonmanufacturing industries into highly diversified conglomerates.
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From page 28... ...
beginning in the late 1920s is the predecessor of the postwar Ministry of International Trade and Industry (MITT) .~ The expulsion of foreign capital prior to the war set the stage for strict controls over trade and foreign direct investment after the war.
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From page 29... ...
that encouraged innovation through procurement, support for technology development, creation of a favorable environment for the importation of foreign technology and the provision of infrastructure for technical human resource development; (2) a technologically savvy industrial sector largely focused on serving smallerscale, specialized demands rather than mass markets, and implementing flexible innovation and manufacturing strategies through focal factories and extensive utilization of subcontracting and corporate networks; and (3)
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From page 30... ...
Shipbuilding was one of the industries initially targeted by the Japanese government for preferential treatment in the form of access to scarce foreign exchange and low-interest policy financing.~9 Advanced structural welding and "block" construction techniques key process technologies were acquired when the Japanese government allowed the U.S. shipbuilder National Bulk Carrier Company to temporarily use the former Japanese navy yard at Kure in return for unrestricted access to manufacturing technologies by Japanese shipbuilders.20 Building on these foreign techniques, the Japanese shipbuilding industry launched a series of collaborative research projects and developed further innovations.
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From page 31... ...
The experiences of U.S. companies that sought to gain access to the Japanese market through exports or direct investment during the 1950-1980 time frame illustrate how Japanese industry and government worked together to gain access to foreign technologies while limiting access to the Japanese market.24 IBM, Texas Instruments, and a few other companies with very strong patent positions were able to negotiate restricted access to the Japanese market through wholly owned subsidiaries after protracted negotiations, conditional on widespread licensing of their basic technologies to Japanese competitors.
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From page 32... ...
En the late 19SOs the importation of new commercial video recorders by Japanese government broadcaster NHK from U.S. inventor Ampex alerted MIT} and led to a systematic effort to import the basic technology.30 Several years later Sony developed a much smaller machine that could be used to show movies in commercial jet aircraft, and in 1969 it introduced the U-Matic, which reached a large industrial marketed Sony and Matsushita later developed video cassette recorders for home use, the Matsushita standard eventually winning out to achieve enormous commercial success around the world.
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From page 33... ...
Even as greater opportunities to pursue mass markets grew during postwar economic growth, Japanese industries generally did not pursue vertical integration and rigid production and management systems. Rather, interfirm networks of various types have proliferated and evolved.
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From page 34... ...
Although the Japanese auto industry did not receive direct government assistance on the scale of some other manufacturing sectors, imports were restricted through the use of quantitative limits and high tariffs.40 This discouraged foreign manufacturers from entering the Japanese market and allowed the Japanese auto industry to develop its manufacturing and technological capabilities in a protected domestic market. The semiconductor industry provides another example of a Japanese industry that was able to accumulate experience and raise productivity under the umbrella of trade protection.4~ Export promotion has played a role as well.
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From page 35... ...
The MITT-financed Japan Electronic Computer Corporation, which purchased and leased Japanese computers to domestic users, was a key factor in the growth of Japan's computer industry during the 1960s and 1970s.43 A financing program intended by MIT} to encourage consolidation of small manufacturers was co-opted at the local level and mainly used to purchase sophisticated machine tooAs.44 Technology development programs also have had a positive impact in a few specific industries.45 Unlike the United States, where a number of technologies underlying major industries have been developed with government funding, Japanese government funding has not yet yielded significant breakthroughs. However, most analysts agree that the extensive network of national laboratories, local and regional.
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From page 36... ...
The first has involved efforts to improve lapan's level of basic scientific and engineering research, with a focus on particular fields with perceived potential for wide commercial application. The second thrust has been the development of new mechanisms for tapping foreign science and technology more appropriate to the changed environment, such as overseas R&D laboratories and international R&D programs funded by the Japanese government.
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From page 37... ...
. With the Basic Law on Science and Technology passed by the Diet in 1995 and the Science and Technology Basic Plan released in July 1996 (see Box 2-~)
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From page 39... ...
For example, several of the Key Technology Center projects invited participation by foreign multinational companies, including IBM's membership in the International Fuzzy Engineering Research Lab.58 The Human Frontier Science Program (HFSP) , a joint MITIScience and Technology Agency effort to fund international teams doing basic research in life sciences, was first proposed by Prime Minister Nakasone in 1987, and a significantly scaled back version of the plan has been operating for a number of years.
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From page 42... ...
Although the number of new investments and programs has fallen in the past few years, anecdotal evidence indicates that at least some Japanese companies are continuing their focus on international collaboration in fundamental science and engineering research related to their core businesses.63 62 For a summary of Japanese government efforts in this area, see National Science Foundation Tokyo Office, "Japan's Technical Cooperation with Asian Countries," Report Memorandum #96-17, July 1996. 63 There are no comprehensive reliable data on foreign corporate funding of U.S.
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From page 43... ...
Although Japan faces challenges, the institutions and capabilities underlying Japanese innovation possess deep strengths, which the task force believes will reassert themselves in perhaps unexpected ways.66 One critical question is how the accelerating movement of manufacturing activities offshore by Japanese companies will affect their long-term technological capabilities and competitiveness.67 Also, the Science and Technology Basic Law and Basic Plan are evidence of renewed efforts to build a stronger basic research base and to reduce dependence on U.S. fundamental research.
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From page 44... ...
capacity of Japanese government, industry, and universities to change their habits, relationships, and technical culture.
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