Nishimura Kyuzaemon

Yonezawa Domain's two major cash crops in the early Tokugawa era were flax and lacquer trees. Lacquer trees were cultivated both for their fruit, which was used to make wax, and for their sap, which was processed into lacquer. The trees, which could grow in relatively poor soil, served as an important cash crop for Yonezawa farmers, and cultivation spread rapidly in the early 1600s. In the late 1680s the domain began to intensify its control over lacquer production, and by 1689 the government had established a full monopsony.

In order to secure capital, domains could do that through merchant houses; the merchant would monopsonize the product with private capital and forward a portion of the monopsony proceeds to the domain. Lack of capital was but one reason to ally with powerful merchants. Even when domains could successfully monopsonize a product domestically, they frequently needed established merchant houses to market the goods outside the domain.

Initially the domain granted monopsony rights to Nishimura Kyuzaemon, a powerful Kyoto merchant. In the 1690s, however, Nishimura fell out of favor, in part because of the failure of a project he had advocated and supervised the widening of the Mogami River near Arato.

When the project ran severely over budget, the government stripped Nishimura of his monopsony rights and instead authorized 33 rural merchants to purchase flax.