Effect of Amakudari on Bank Performance in the Post-Bubble Period

One of the curiosities about the Japanese banking sector for Westerners is the close connection between banks and the financial authority, namely Ministry of Finance (MoF). One of the important sources of this connection is the practice called amakudari. Amakudari symbolizes the practice under which retired government officials "descend from their heaven" to be employed in the private sector. The practice has long been carried out in the banking sector, as well as other industrial sectors in Japan. Previous studies, particularily Horiuchi and Shimizu (2001), examined the effect of the close connection between banks and the financial authority in Japan, so-called amakudari. However, their observation did not cover the "post-bubble" period in which one may expect some changes. The present study re-examines this amakudari practice adopting the latest data, redesigning and developing the previous model. It found that the overall effect of amakudari was reduced through the 1990's, but this is just because of the reduction of amakudari appointments. In fact, the gap between the banks with amakudari and the others became wider in recent years.amakudari; financial supervision; Japan; incentives of regulator; post-bubble

Web-based English Language Investment Information by Japanese Companies

"Investor Relations" has become one of the most fashionable phrases among Japanese companies in recent years, particularly as a result of the rising impact of foreign investors in Japan. An English-language website may be one of the most effective measures for providing corporate information to a non-Japanese audience, but the attitude of Japanese companies on this point is mixed. Based on a questionnaire survey and a trend analysis, this study identifies a number of factors underlying Japanese attitudes. It also constructs a regression model, whereby the provision of English-language information has a positive effect on foreign investment is observed.internet; web; investor relations; Japan

Rethinking Japan's Bad Loan Management: Implications from a Comparison with the Swedish Case

Japan and the Nordic countries similarly experienced a serious collapse of the Bubble economy in the early 1990s, but the financial recovery of the former is extremely delayed compared with the latter. In Japan, the Ministry of Finance is often accused of this, with the claim that it has acted too arbitrarily. The assumption is that it has held, or had held at least until recently, excessively strong power in the policy-making process, based on the close connection with banks and politicians. However, the close connection between relevant actors may also reduce the scope of their performance. If the policy-making process is conceptualized as the network linking relevant public/ private actors, the Japanese financial authorities are rather seen as “trapped” into sticky relations with other actors in the network. As suggested in the literature of social network and social learning, too close and too closed connections may deteriorate the learning competence of the actors in the network, partly because their action tends to be restricted and partly because they tend to get less information from outside. This theory seems to be strongly supported by the evidence of Japan and Sweden.Japan; Sweden; bubble economy; banking crisis

Competition Policy in the Japanese Banking Sector: Support Big Bang?

While the recent “Big Bang” reform fundamentally aims at enhancing market competition in the financial sector, the Japanese competition authority, the Fair Trade Commission (FTC), seems to be rather reluctant to participate in relevant discussions. The present paper focuses on this aspect, relating the FTC’s reluctance to its traditional close relationship with the Ministry of Finance (MoF). The paper examines the structure of the relationship between the FTC and the MoF, considers its reason on the side of the FTC from Pfeffer and Salancik’s “Resource Dependence Perspective”, and discusses its effect on the recent “Big Bang” reform. Its main argument is that the FTC – MoF link is beneficial not only to the MoF but also to the FTC, and that this structure has yet to be changed even after the FTC began to increase its performance.Japan; competition policy; bank; big bang

CORPORATE SOCIAL RESPONSIBILITY IN JAPAN: ANALYZING THE PARTICIPATING COMPANIES IN GLOBAL REPORTING INITIATIVE

Following the US and Europe, Japan is now becoming aware of the importance of Corporate Social Responsibility (CSR). In fact, Japan has become the country with the largest number of participants in Global Reporting Initiative (GRI), which is currently the most acknowledged reporting system of CSR in the world. However, the mere number of the participants does not tell much. The Japanese approach to CSR may well differ from the Western approach, given various differences in their socio-economic characteristics. Against this background, two empirical tests are conducted. The identification of the characteristics of the Japanese adopters of GRI Guidelines implies the erosion of the traditional corporate-centered system of that country both from outside and from inside. On the other hand, the manner of adoption is found to be quite different between Japan and the West, which may be a sign of cultural or systematic resistance to total convergence.corporate social responsibility (CSR); global reporting initiative (GRI); international comparison; Japan; system perspective

Proof of the renormalizability of the gradient flow

We give an alternative perturbative proof of the renormalizability of the system defined by the gradient flow and the fermion flow in vector-like gauge theories.Comment: 29 pages, the final version to appear in Nuclear Physics