ABSTRACT
Japanese cooperatives have grown to become world-class organizations. Agricultural cooperatives (JAs) with farmers as members market half of agricultural products, while consumer cooperatives (Seikyo) with members from every second household are cumulatively ranked as the third largest retailer, involving one in two households as cooperative members. However, these cooperatives have followed quite divergent paths in the political economy that has sought state-led development. JAs have been supported by and protected under the “industrial policy triangle” of the ministry, legislature and central union of agricultural cooperatives. In contrast, Seikyo have been bothered by impediments of a total ban of non-member trade imposed under the pressure of anti-cooperative campaigns by small retailers. These institutional frameworks contributed to the evolution of different political affinities and organizational cultures.
South Korean cooperatives have followed a similar trajectory. They have made a spectacular development since the 1960s, and now agricultural cooperatives (NongHyup: NH) have become large agrobusiness-cum-financial institutions, while consumer cooperatives are fast-growing and innovative retailers.
Thus, these East-Asian cooperatives have grown to attract wide concerns among cooperatives. However, globalization poses challenges to both institutions: deregulation in agricultural policy and increased competition in the food chain. The demographic changes of depopulation associated with rapid aging and fewer children impact their businesses, while the degrading natural environment urges a quick response. This chapter seeks to understand from a developmentalist state perspective the reasons why they followed different trajectories by examining the context, chronology, structure, impact, and challenges.
