| Budget Amount *help |
¥3,100,000 (Direct Cost: ¥3,100,000)
Fiscal Year 2006: ¥1,000,000 (Direct Cost: ¥1,000,000)
Fiscal Year 2005: ¥900,000 (Direct Cost: ¥900,000)
Fiscal Year 2004: ¥1,200,000 (Direct Cost: ¥1,200,000)
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| Research Abstract |
Japanese Subcontract Act (Act Against Delay in Payment of Subcontract Proceeds, etc., to Subcontractors), has been enforced by Japanese Fair Trade Commission (JFTC) since 1956. It has been said that long-term transaction relationship between parental entrepreneurs and subcontractors caused the locked-in and hold-up problems.
First, we examine industries with high possibilities of these problems. By using the index (the number of parental entrepreneurs and the ratio of subcontract proceeds to total sales), we specify 3 industries.
Second, we investigate prohibited conducts which we can explain as concrete examples of these problems. The most number of illegal conducts is "delay in payment", followed by "delivering long-term bill" and reducing the amount of subcontract proceeds. Recently we can confirm the following illegal conducts have increased; non-preparation and non-preservation of documentation setting forth the work of the subcontractor, the receipt of work, payment of the contract proceeds and other matters.
Third, we examine how degree does JFTC mitigate the hold-up problems. We employ the OLS method.
We adopt and define the following dependent variables; (1) the number of delay in payment to total illegal conducts, and (2) the number of delivering long-term bill to total illegal conducts. We adopt and define the following independent variables. Investigation ability of JFTC; (1) the number of subcontract division staff to the total staff of JFTC, and (2) the ratio of working capital of subcontract act to the total budget of JFTC. Judging from the significance of their estimations, the increase of staff and budget mitigated hold-up problems
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