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The purpose of this paper is to draw on Asanuma's concept of relation-specific skills in order to analyse collaboration between automaker and supplier. The cultivation of relation-specific skills has been widely regarded a key factor of competitiveness in the Japanese automotive industry. Yet, the concept has been described mostly in economic terms only. This research attempts to extend this view by analysing the role of informal institutions (trust) in developing relation-specific skills.

By drawing on expert interview data, evaluated by using content analysis, within the frame of a case study research approach, the authors gathered data from the leading multinational automotive supplier Bosch in its facilities in Japan and Germany.

The results show that the influence of trust plays a role in determining relation-specific skills. In conclusion, the authors assume that cultural homophily positively influences the cultivation of relation-specific skills and recommend future research to take this assumption into account.

Findings imply that over the course of business transactions organisational structures hardly converge leading to higher transaction cost. Moreover, Keiretsu structures are still strong in the field of automotive electronics.

So far the concept of relation-specific skills has been regarded a “culture-free” concept. The results provide a first indication that cultural differences affect the cultivation of relation-specific skill, and thus need to be considered integral to the concept.

A Review essay on Tatsuya Sakamoto and Hideo Tanaka (Eds), The Rise of Political Economy in the Scottish Enlightenment, London: Routledge, 2003 pp. xii+215. ISBN 041529648X £60.00. This volume is composed of thirteen short but concentrated essays and an introduction on the rise of political economy in the Scottish Enlightenment, each written by a distinguished Japanese scholar. Although the contributors are engaged in international scholarly activities, the volume devotes one chapter to “Adam Smith in Japan” and elsewhere draws attention to scholarly interpretations of Smith in the “West.” Both suggest that the perspective, whilst linked directly to international scholarly discussion through modern works consulted and themes identified in earlier literature (the edited volume by Hont and Ignatieff (1983) being cited, amongst others, as historically significant for the development of the approach set out in the collection), carries insights that arise out of earlier but sustained Japanese interest in the notion of social and cultural modernization and reform. It is perhaps also in this context that they hit on the centrality of the issue of “manners,” shorthand for morals, values, political behaviour, economic motivation and so on. Tatsuya Sakamoto makes this notion of “manners” explicit in his interesting chapter on Hume (p. 92) and Shoji Tanaka makes central the formation of free individuals liberated from feudalism and “religious delusions” (p. 134).