INTRODUCTION
D. Attending the Court Hearing
XI. CONCLUSION
Figure 2 Large-scale retail store site law (to be implemented in 2000). (From Nihon Keizai Shimbun, 25 December 1997, p. 10; 24 May 1998, p. 8.)
social impact, and if necessary, issue recommendations of changes, under the Large Store Site Law (see Figure 2). Large supermarket interests, suspicious of subjective and extended regulations by municipalities in the absence of a specific definition of ‘‘serious and irreversible’’ social impact, opposed the plan. Mean- while, small retailers also opposed the plan in the absence of a clear assurance of their participation in the municipal evaluation process.87However, these reform measures passed the Diet in May 1998, and the new law will be implemented in 2000. MITI is to issue guidelines to municipalities, which include uniform criteria for large retailers to consider in opening new stores.88
the law was more incremental than it looked due to informal sabotage at the implementation stage. Under the new law, extended local autonomy may still prevent large stores from opening. Small retailers derived their political strength through their plural access channels to the LDP, the MSEA, local governments, and the Ministry of Home Affairs. With the declining influence of the MSEA within MITI, small retailers’ alliance with MITI was possible only to the extent that neither liked complete abolition of the LSRSL.
The LDP’s role, backed by its political strength during the 1980s, remained that of a mediator among the status quo interests of the bureaucracy, small retail- ers, department stores, and supermarket chains. As small retailers declined in number, their political strength was destined to decline. Nevertheless, general decline of the LDP popularity since the late 1980s slowed down the decline of relative strength of small retailers well into the 1990s. However, the LDP in the 1990s let the MITI take a lead in deregulation, contrasting its own reregulation initiative until the early 1980s.89
The LSRSL failed to solve conflicts between large and small retailers. Ex- tended shopping distance, specialization, cooperation among large and small stores, and proliferation of membership stores have made the LSRSL obsolete.
However, the whole process is characterized by the absence of a consumer per- spective. Incremental reforms have advanced large retailers bargaining power vis-a`-vis wholesale distributors, at the cost of small retailers. However, the cost advantage gained by the large retailers has not been enjoyed by Japanese consum- ers. A more meaningful retail reform seems to lie in the area of antimonopoly laws.
Small retailers’ resistance seems to have exhausted their ammunitions at the national level, but they have acquired a potentially strong influence via local municipalities. The structure of the retailing industry has been defined by cultural, historical, and natural conditions, and varies from one region to another.90The delegation of the retail regulation authority to local government levels has the potential to allow regionally unique evolution of the retail industry. However, whether MITI will set clear criteria for large stores, and whether local municipali- ties will refrain from setting additional criteria in evaluating store opening appli- cations, are yet to be seen.
Keeping the above analysis in mind, I would like to conclude this chapter with some proposals. Further reform of the retail regulations should encompass all of the following goals:
1. MITI should set the minimum store size, under which store opening cannot be regulated by local municipalities.
2. Establishment of larger commercial zones for driving consumers, and smaller urban commercial zones for nondriving consumers within each ‘‘driv- ing’’ zone by municipalities.
a. Relaxation in store size and operation hours/day regulations in the sub- urban driving zones.
b. Relaxation in operations hours/days, but maintain moderate store size limit in the urban nondriving zones under the local government’s au- thority.
3. Antimonopoly monitoring and enforcement in each driving zone. The enforcement should be based not on each store’s sales, but on each enterprise’s sales within the zone.
All of the reform initiatives require a strong political leadership, since they will inevitably have to redraw the existing jurisdictional boundaries. Without a strong leadership, neither small retailers nor consumers would enjoy prosperity.
ACKNOWLEDGMENTS
The author expresses his special thanks to Associate Professor Robert Angel of the University of South Carolina, Associate Professor Mayumi Itoh of the Univer- sity of Nevada at Las Vegas, and Masahiko Asano of the University of California at Los Angeles for their insightful comments and valuable suggestions on the earlier draft of this chapter. The author also thanks Provost Nancy Renkiewicz of the Trans-Pacific Hawaii College for the use of the college’s computer facility.
ENDNOTES
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AppendixRegulationsofLarge-ScaleRetailStoreOpening Maximumtime LawSubjectofregulationRegulatorybodiesContentsofregulationforadjustments 1979Large-scaleretailStoresover1500m2MITI(principal);Prefec-ReportingofbuildingNolimit(18monthsafter storelawturalgovernor,Cham-plan,reportingofstorethe1990Administra- berofCommerce,openingandexpansiontiveguidance) municipalgovernmentplan(defactopermit (legallymandatedcon-system,requiringfull sultation);localretail-consentofthelocalre- ers(defactopartici-tailersbeforeaccepting pants)thereport) Storesover500m2PrefecturalGovernorLimitondailystoreopera- (principal);prefecturaltionhours(adhoc,bar- MITIoffice,Chambergainingbetweenlocal ofCommerce,munici-retailersandthelarge palgovernment(legallystore),mandatedstore mandatedconsulta-closingdays(adhoc, tion);localretailers(debargainingbetweenlo- factoparticipants)calretailersandthe largestore) One-per-yearquotaon newdepartmentstore openingbyeachofthe 10majordepartment storeenterprises;enter- prise-basedfloorin- creaselimiton13su- permarketchains(1982 Administrativeguid- ance)
AppendixContinued Maximumtime LawSubjectofregulationRegulatorybodiesContentsofregulationforadjustments 1991Large-scaleretailStoresover1500MITI(principal);prefec-ReportingofbuildingOneyear storelaw(3000inlargeturalgovernor,Cham-plan,reportingofstore citiesdesignatedberofCommerce,mu-openingandexpansion byanordinance)nicipalgovernmentplan,limitondaily m2(legallymandatedcon-storeoperationhours sultation);localretail-(closingat7pm),man- ers(defactopartici-datedstoreclosingdays pants)(44days/year) Storesover500butPrefecturalgovernor(prin- below1500(3000cipal);prefecturalMITI inlargecitiesdes-office,Chamberof ignatedbyanordi-Commerce,municipal nance)m2government(legally mandatedconsulta- tion);localretailers(de factoparticipants) 1994AdministrativeStoresover3000MITI(principal);prefec-ReportingofbuildingOneyear guidance(6000inlargerturalgovernor,Cham-plan,reportingofstore citiesdesignatedberofCommerce,mu-openingandexpansion byanordinance)nicipalgovernmentplan,limitondaily m2(legallymandatedcon-storeoperationhours sultation);localretail-(closingat8pm),man- ers(defactopartici-datedstoreclosingdays pants)(24days/year)
Storesover1000butPrefecturalgovernor(prin- below3000(6000cipal);prefecturalMITI inlargecitiesdes-office,Chamberof ignatedbyanordi-Commerce,municipal nance)m2government(legally mandatedconsulta- tion);localretailers(de factoparticipants) 2000Large-scalestoreStoresover1000m2Prefecturalgovernor,cityMunicipallandzoningOneyear sitelawmayorinlargecities(CityPlanningLaw) designatedbyanordi-Reportingofnewstore nance(principal);localopeningandexpansion, governments,residentsplanevaluationfrom (consultation);MITIcityplanningperspec- willissueaguidelinetive(suchastrafficcon- forlargestorestocon-trol,parking,noise,gar- siderinplanninganewbageproblems), storerecommendationforal- teringtheplan
8
Democracy, Development, and the Welfare State in India
A Win-Win Policy Analysis
Noorjahan Bava
University of Delhi, New Delhi, India