Restructuring of Agricultural Cooperative System and the Position of the Prefectural Economic Federation of Agricultural Cooperatives

In 1991, the general assembly of Japanese agricultural cooperatives agreed on an organizational restructuring called the “two level business and administrative reorganization” Under this proposal, prefectural-level federations of agricultural cooperatives were to be abolished and their functions were to taken over by the national-level federations and business unit associations. The national-level federation was to supervise the business unit associations directly, i. e., so-called “two-level restructuring without middle levels”. Following this decision, the prefectural economic federation of agricultural cooperatives was reorganized into 34 prefectural headquarters under the Zennoh federation (Zennoh integrated type). In 5 prefectures, the former prefectural economic federation of agricultural cooperatives reorganized into 5 agricultural cooperatives; one per prefecture (United one type). In addition, 8 prefectural economic federation of agricultural cooperatives maintained their prefectural organization (Independent type) and decided to focus on sales as their primary economic activity in order to strengthen prefectural level functions. These eight, such as Hokuren, were powerful. Although there have been studies regarding the persistence of the independent prefectural cooperative, no comprehensive systematic study has been conducted. This study revealed several reasons why 8 prefectural cooperatives did not unite with Zennoh for more than 20 years after the restructuring. It also shows that the Independent type cooperative has economic advantage compared to the Zennoh integrated or United one typ