Spatial patterns of main office locations of civil engineering companies in nonmetropolitan areas

Abstract

It has been pointed out that the locations of civil engineering companies' main offices are hierarchically and territorially dispersive in nonmetropolitan areas of Japan. (defined in this paper as areas excluding Tokyo, Osaka and Nagoya metropolitan areas). Such location patterns reflect divided public work markets due to protection of local and small or medium enterprises (SMEs) by a rank system, nominated tendering system, and the Law for Protection of SMEs Receiving Public Work Orders. Thus far, a nationwide location analysis of civil engineering companies' main offices was almost impossible due to limited data usability. Nevertheless, as part of drastic public investment and civil engineering industry reform policies after the mid-1990s, the national government started phased disclosures of civil engineering companies' keiei jiko shinsa (rating system in public work tendering) data, as electronic data in 1998. Using the latest keiei jiko shinsa data, this paper examines the spatial patterns of main office locations of civil engineering companies in nonmetropolitan areas and provides a verification of the universality of such location patterns. The main findings are summarized as follows: First, civil engineering companies locate their main offices in nonmetropolitan prefectures to put their management bases on favored status in bids to local public institutes. They can be clearly distinguished from nationwide civil engineering companies in terms of sales and deployment of branch offices. Second, excluding a small number of prefectures with large civil engineering companies engaged in transprefectural sales activities, the sales of top civil engineering companies in nonmetropolitan prefectures are concentrated in the range from 6.2 to 8.1 billion yen and their superiority in these prefectures are low. These findings show that the civil engineering industrial structures of these prefectures have strong similarities. Third, excluding territories with extremely small populations like isolated island areas, most prefectural civil engineering section branches have over 10 billion yen in sales of civil engineering companies within their territories.