Public testing and research centres in Japan: Control and nurturing of small and medium-sized enterprises in the automobile industry

Many industrialized economies have seen a relative increase of small and medium-sized enterprises (SMEs) compared with large companies since the 1980s. To faster the rise of SMEs, many governments have established Innovation and Diffusion Institutes. This paper examines the role of the Japanese public testing and research (PTR) centres (kosetsu shiken kenkyu kikan), which have been proposed as a model for other countries. The paper traces the backgrounds and general activities of the PTR centres, an subsequently focuses on how PTR centres have assisted SMEs in the vicinity of Japan's five large car makers. It is found that in 1986 the PTR centre near Toyota's main assembly facilities performed the largest number of test inspection of SMEs in Japan, indicating that the Toyota production system relies to an extraordinary degree upon certification by a PTR centre. Technical consultations played a greater role at PTR centres in the vicinity of other Japanese auto producers, indicating that suppliers gained more independence from their client firms.