EG2008 Yamamoto Egc

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Y2008 Economic Gardening Gathering in Steamboat: Yamamoto Introducing EG to Japan

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EG2008 Yamamoto Egc

  1. 1. Endogenous Development Models and Economic Gardening: A Case of an Entrepreneurial Farming Village in Japan Takashi Yamamoto Center for Entrepreneurship and Leadership Studies for Regional Economies (CELS) Akita International University Y = F (K, L, E )
  2. 2. Outline <ul><li>Comparing Endogenous Development theories </li></ul><ul><li>Case: Ogata Village, Japan </li></ul><ul><ul><li>History </li></ul></ul><ul><ul><li>Statistics </li></ul></ul><ul><li>Analysis </li></ul>
  3. 3. Endogenous Development Theories - West and East <ul><li>“ Inside-out” instead of “Outside-in” </li></ul><ul><ul><li>Emphasizing local initiatives </li></ul></ul><ul><ul><li>Local resources supplemented by outside resources and buyers </li></ul></ul><ul><li>Exercising Schumpeterian entrepreneurship </li></ul><ul><li>West </li></ul><ul><ul><li>Economic growth as a primary goal </li></ul></ul><ul><ul><li>Capital accumulation strategy </li></ul></ul><ul><li>East </li></ul><ul><ul><li>Sustainability of local economy as a goal </li></ul></ul><ul><ul><li>Motivated “key persons” as change agents </li></ul></ul>
  4. 4. Key Persons <ul><li>Appeared in Japanese endogenous development literature </li></ul><ul><li>Attractive local leaders as change agents </li></ul><ul><ul><li>Knowing both inside and outside of the region </li></ul></ul><ul><ul><li>Keeping and developing network with outside </li></ul></ul><ul><ul><li>Change agents seeing the region comparatively and objectively </li></ul></ul><ul><li>Key persons in Akita </li></ul><ul><ul><li>“ Outside-in”, who migrated into Akita </li></ul></ul><ul><ul><ul><li>Mr. Wakui in Ogata Village </li></ul></ul></ul><ul><ul><li>“ U-turn”, who came back to Akita </li></ul></ul><ul><ul><ul><li>Mr. Ebinne and others in Neiger Project </li></ul></ul></ul>
  5. 6. Endogenous Development in Japan
  6. 7. Ogata Village, Akita:
  7. 8. Unique History of Development <ul><li>Created by a national project of land reclamation in 1957 to increase rice production </li></ul><ul><li>Initial 580 settler families from all of Japan </li></ul><ul><li>Basic infrastructure such as irrigation and roads completed at the earliest stage </li></ul><ul><li>National policy changed in 1970 to reduce rice production </li></ul><ul><li>Entrepreneurial farmers struggled to continue producing rice and to develop new marketing channels since 1980s </li></ul>
  8. 9. Japan is the Least Entrepreneurial Country
  9. 10. Akita is the Least Entrepreneurial Prefecture <ul><li>Economic indicators </li></ul><ul><li>Prefectural income per capita (2001): 41th out of 48 prefectures </li></ul><ul><li>Prefectural saving per capital (2002): 44th out of 48 prefectures </li></ul><ul><li>Comparative Survey on Entrepreneurship among 48 Prefectures (2000) </li></ul><ul><li>Number of researchers at public research institutes (per 1000 firms): 5th from the top </li></ul><ul><li>Number of public business incubator rooms (per 1000 firms): 8th from the top </li></ul><ul><li>Number of industry-academy-public cooperation center (per 1000 firms): 2nd from the bottom </li></ul><ul><li>Number of venture firms (per 1000 firms): 13th from the bottom </li></ul><ul><li>Number of firms listed in major stock markets (per 1000 firms): 16th from the bottom </li></ul><ul><li>Number of public seminars for entrepreneurship (per 1000 firm): 12th from the bottom </li></ul><ul><li>“ Why have to changes while I am doing well enough?” </li></ul><ul><li>“ I won’t do it. Therefore, you shouldn’t do it, either” </li></ul><ul><li>“ I want to look good, so I do not want to fail.” </li></ul>
  10. 11. Where SME are significant, <ul><li>“ Mice ” with 9 employees or less </li></ul><ul><ul><li>81% of establishments, 29% of employment </li></ul></ul><ul><li>“ Rabbits ” 10-19 employees </li></ul><ul><ul><li>10% of establishments, 17% of employment </li></ul></ul><ul><li>“ Deer ” 20-99 employees </li></ul><ul><ul><li>8% of establishments, 35% of employment </li></ul></ul><ul><li>“ Bears ” 100 employees or more </li></ul><ul><ul><li>1% of establishments, 19% of employment </li></ul></ul>
  11. 12. But this Entrepreneurial Village is Successful. <ul><li>Municipality income per capita (2003): US$34,243. </li></ul><ul><ul><li>68.2 percentage points larger than the prefectural average. </li></ul></ul><ul><ul><li>Largest among municipalities in Akita since 1990, except during &quot;IT bubble&quot; years in 1999 and 2000. </li></ul></ul><ul><li>Highly specialized in rice production </li></ul><ul><ul><li>sector centrality value of agriculture is 0.7598 </li></ul></ul>Rhi = Annual production output of each municipality RH = Annual production output of Akita Prefecture Poi = Population of each municipality PO = Population of Akita Prefecture
  12. 13. Entrepreneurial Farmer <ul><li>Toru Wakui </li></ul><ul><ul><li>Disobeyed government policy of reducing rice production, and sold rice through direct marketing to consumers </li></ul></ul><ul><ul><li>Established a rice marketing company with other farmers. </li></ul></ul><ul><ul><ul><li>Currently hiring 160 employees </li></ul></ul></ul>
  13. 14. Akita Komachi Corp. http://www.akitakomachi.co.jp/
  14. 15. History of Ogata Village compatible with… <ul><li>Endogenous development philosophy </li></ul><ul><ul><li>Entrepreneurial farmer as key persons </li></ul></ul><ul><ul><li>Use of local resources </li></ul></ul><ul><li>“ Rural” Economic Gardening </li></ul><ul><ul><li>Use of information for direct marketing channels to sell rice products to consumers </li></ul></ul><ul><ul><li>Collaboration among farmers, researchers, and agriculture cooperatives </li></ul></ul><ul><ul><li>Combination of tourism and agriculture </li></ul></ul>
  15. 16. Another Entrepreneurial “Key Person” <ul><li>Tamotsu Ebina </li></ul><ul><ul><li>Former wrestler, now “Neiger the Hero”, who could save Akita </li></ul></ul><ul><ul><li>All handmade </li></ul></ul><ul><ul><li>Performing 200 shows in a year, only in Akita </li></ul></ul><ul><ul><li>Producing contents of local heroes for other prefectures </li></ul></ul>Photo downloaded from http://akita.keizai.biz/headline/photo/126/
  16. 17. The Neiger Project <ul><li>Started in 2005 to vitalize local community </li></ul><ul><ul><li>No support from government or business </li></ul></ul><ul><li>Established a firm Seigi no Mikata ( Allies of Justice ) for promotion </li></ul><ul><ul><li>Several employees and professional artists </li></ul></ul><ul><ul><li>Character goods from snacks to cell straps </li></ul></ul><ul><li>Media coverage </li></ul><ul><ul><li>Short programs on local TV </li></ul></ul><ul><ul><li>Comics sold nation-wide and in Taiwan ! No English yet </li></ul></ul><ul><li>Same stage charges since initiation </li></ul><ul><li>Received an award in 2006 for encouragement to local people </li></ul>http://homepage1.nifty.com/nexus/neiger/
  17. 18. Neiger show in Odate, Akita Photo downloaded from http://northline.blog82.fc2.com/blog-entry-108.html
  18. 19. Conclusion <ul><li>“ Endogenous development philosophy + EG policy framework” applicable in Japan </li></ul><ul><li>Key factors of local economic revitalization: </li></ul><ul><li>Good environment & Key persons </li></ul><ul><li>Focused on promising entrepreneurs: </li></ul><ul><ul><li>Owners portray a genuine interest in being helped. </li></ul></ul><ul><ul><li>Growing firms. </li></ul></ul><ul><ul><li>Management values innovation and new ideas. </li></ul></ul><ul><ul><li>Local business, rather than a corporate subsidiary. </li></ul></ul><ul><ul><li>Cluster of companies. (Rossouw & van der Walt, 2003) </li></ul></ul><ul><li>Cooperation among business (farmers), academics, and government </li></ul><ul><li>Y = F (K, L, E ) </li></ul>
  19. 20. P.S. <ul><li>Economic Gardening getting known in Japan </li></ul><ul><ul><li>「エコノミック・ガーデニング」 No hits in 2007; about 100 hits today by Googling </li></ul></ul><ul><ul><li>Introduced by some blogs and newsletters </li></ul></ul><ul><ul><li>Dr. Iuchi of CRIEPI as research partner </li></ul></ul><ul><li>What an economist can do? </li></ul><ul><ul><li>EG Case studies and check-rides in Japan </li></ul></ul><ul><ul><li>Prove effectiveness of “EG + ED + Entre” set </li></ul></ul><ul><ul><li>Next destination: Korea or Taiwan? </li></ul></ul>
  20. 21. What is Community ? <ul><ul><ul><ul><ul><li>空 Space   Space </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>風 Wind   Wisdom </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>火 Fire   Production </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>水 Water Amenity </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>地 Earth Connection </li></ul></ul></ul></ul></ul>
  21. 22. People and Location <ul><ul><li>空    Space     environment, atmosphere </li></ul></ul><ul><ul><li>風    Wisdom    intellectuals, talented </li></ul></ul><ul><ul><li>火    Production entrepreneurs, farmers </li></ul></ul><ul><ul><li>水    Amenity    nature, festivals, services </li></ul></ul><ul><ul><li>地    Connection   tradition, governance </li></ul></ul>

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