Strategic Alliances in the Japanese Economy: Types, Critiques, Embeddedness, and Change

This paper provides an overview and interpretive analysis of the Japanese strategic alliance process. Both international and domestic alliances are considered, although the emphasis is on domestic partnerships. I argue that the domestic Japanese economy is "underallianced" relative to Japanese firms' extensive involvement in partnerships with foreign firms. This is particularly true if government-sponsored consortia and keiretsu-based tie-ups are excluded. Japanese companies appear, for a variety of institutional and cultural reasons, to have had some difficulty partnering with strangers and competitors and that has led to the formation of fewer synergistic and otherwise constructive intra-country cooperation arrangements than corporate Japan arguably needs. That pattern is changing, however, and there is evidence that the rate of intra-country alliances among Japanese firms is accelerating, particularly when the focus of the alliance is technology and innovation.