Empirical analysis of R&D in the Japanese construction industry based on the structure conduct performance model

Abstract

This study examines the reasons for research and development (R&D) inactivity in Japan’s construction industry. Specifically, it considers the structure of the construction industry in Japan and identifies contractors’ patterns of behaviour regarding R&D. This study examines the relations among the structure of the construction industry, contractors’ behaviour patterns and contractors’ performance. The theoretical background of analysis is based on the structure conduct performance model. This study examines the impact of the public works system in Japan on contractors’ R&D investments, using a regression analysis based on actual data. This study finds that only contractors with a high Keiei Jikou Sinsa score, which is an examination of subjective matters during the bidding process for public works projects, actively conduct R&D activity. This implies that R&D investment can enhance future profits; thus, Japanese Government’s bidding system impacts contractors’ R&D investments.

Keywords

• innovation
• regulation
• bidding
• pre-qualification
• r&d