the system. For this reason, case studies are important since each industry has a different distribution system that depends on the nature of competition, the degree of production concentration, product attributes and industrial history.
Second, it was pointed out that the “sales-distributionKeiretsu” system promotes collusive pricing behavior among Japanese manufacturers. The system is characterized by exclusive dealership arrangements, territorial restrictions, complicated rebate systems and resale price maintenance systems. Such features are frequently
to be higher in Japan than in other markets. The paper observes that most of the literature demonstrates that the Japanese distribution system is as efficient as that of other developed countries.
The efficiency of the system has not necessarily resulted in high social welfare, however, as consumers have had limited access to various product lines. In fact, some studies show that the prices of a number of imported products have been substantially higher in Japan than in other developed countries. It has also been pointed out that the “sales-distributionkeiretsu
This paper surveys the recent literature on the Japanese distribution system to consider two propositions: first, that the system is inefficient, and second that prices of imported products tend to be higher in Japan than in other markets. Most of the literature demonstrates that the system is efficient. However, the efficiency has not necessarily resulted in high social welfare as consumers have had limited access to various product lines or paid high prices for some products. This paper examines the distribution system in the automobile industry to promote understanding about the impacts of the system on price differentials.
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