DOI QR코드

DOI QR Code

A new hypothesis for explaining Japan's prolonged financial slump: Mismanagement of audience effects

  • SUZUKI, Yasushi (Graduate School of Management, Ritsumeikan Asia Pacific University)
  • Published : 2010.10.31

Abstract

This paper explores a new hypothesis that can help to shed light on why the Japanese financial system has fallen into a unique transition failure in terms of its extraordinarily prolonged financial slump. An aspect of the continuing Japanese financial slump can be explained in terms of games that were being played between regulators and main banks as each tried to test the intentions and commitment of the other in a context where the traditional system of monitoring had collapsed together with its relationships of trust. Higher "audience costs" which prevented the restoration of appropriate relations between regulators and banks, associated with the internal collapse of trust in the system, can explain this unique transition failure.

Keywords

References

  1. Aoki, M., H. Patrick and P. Sheard. 1994. Introduction: The Japanese Main Bank System: An Introductory Overview. In The Japanese Main Bank System, ed. Aoki, M. and Patrick H., Oxford University Press.
  2. Arrow, K.J. 1974. The Limits of Organization. Norton.
  3. Basle Committee on Baking Supervision (BCBS). 2006. International Convergence of Capital Measurement and Capital Standards: A Revised Framework. Bank for International Settements. June 2006.
  4. Cabinet Office. 2001. Heisei 13 nendo-ban, Keizai Zaisei Hakusho (Annual Report on Japan's Economy and Public Finance 2000-2001). Government of Japan.
  5. Cohen, D. and J.L.Knetsch. 1992. Judicial Choice and Disparities between Measures of Economic Values. In Choices, Values, and Frames, ed. Kahneman. D. and Tversky, A, 2000. Cambridge University Press.
  6. Dore, R. 1998. Asian crisis and the future of the Japanese model. Cambridge Journal of Economics. 22: 773-787. https://doi.org/10.1093/cje/22.6.773
  7. Dore, R. 2000. Stock Market Capitalism: Welfare Capitalism, Japan and Germany versus the Anglo-Saxons. Oxford University Press.
  8. Eichengreen, B. 1999. Toward a New International Financial Architecture, A Practical Post-Asia Agenda. Institute for International Economics.
  9. Elster, J. 2000. Ulysses Unbound, Studies in Rationality, Precommitment, and Constraints. Cambridge University Press.
  10. Freixas, X. and J.C. Rochet. 1997. Microeconomics of Banking. The MIT Press.
  11. Fukuyama, F. 1995. Trust: The Social Virtues and the Creation of Prosperity. Free Press.
  12. Harada, Y. 1999. Nihon no Ushinawareta 10 nenn. Nihon Keizai Shimbun Sha.
  13. Hellmann, T., K. Murdock and J. Stiglitz. 1997. Financial Restraint: Toward a New Paradigm. In The Role of Government in East Asian Economic Development: Comparative Institutional Analysis. ed. Aoki, M., Kim, H-K. and Okuno-Fujiwara, M. Oxford: Clarendon Press.
  14. Hoshi, T. and A. Kashyap. 2001. Corporate financing and governance in Japan: The road to the future. The MIT Press.
  15. Ikeo, K. 2006. Kaihatsu Shugi no Boso to Hosin. NTT Shuppan.
  16. JSBRI (Japan Small Business Research Institute). 2009. 2009 White Paper on Small and Medium Enterprise in Japan. Tokyo.
  17. Khan, M. 1995. State Failure in Weak State: A Critique of New Institutionalist Explanations. In The New Institutional Economics and Third World Development. ed. J.Hunter, J.Harriss and C.Lewis. London:Routledge.
  18. Kindleberger, C. 2000. Manias, Panics and Crashes: 3rd and 4th edition. London and Basingstoke, Macmillan.
  19. Knight, J. 1992. Institutions and Social Conflict. Cambridge University Press.
  20. METI (Ministry of Economy, Trade and Industry). 2005. Heisei 15 nen Kogyo Tokei Hyo (Industrial statistics in 2003).
  21. Nishimura, Y. 1999. Kinyu-Gyosei no Haiin. Bunshun.
  22. North, D.C. 1990. Institutions, Institutional Change and Economic Performance. Cambridge University Press.
  23. Okazaki T. 1995. Sengo nihon no kinyu shisutemu. In Nihon Keiei-shi 5. ed. Morikawa, H. and Yonekura, S. Iwanami.
  24. Okuno-Fujiwara, M. 1997. Toward a Comparative Institutional Analysis of the Government- Business Relationship. In The Role of Government in East Asian Economic Development: Comparative institutional Analysis. ed. Aoki,M., Kim,H-K and Okuno-Fujiwara, M. Oxford: Clarendon Press.
  25. Okuno-Fujiwara, M. 2002. Baburu Keizai to Sono Hatan Shori. In Heisei Baburu no Kenkyu (Jyou). ed. M. Okuno-Fujiwara. Toyo Keizai Shimpo Sha.
  26. Patrick, H. 1998. The Causes of Japan's Financial Crisis, prepared for Conference on Financial Reform in Japan and Australia. The Australia National University.
  27. Saito, S. 1998. 10 nen Defure. Nihon Keizai Shimbun Sha.
  28. Simon, H.A. 1983. Alternative visions of rationality. In Rationality in Action: Contemporary approaches. ed. Moser, P.K.Moser. Cambridge University Press.
  29. SMEA (Small and Medium Enterprise Agency). 2005. 2005 Nendo Chusho Kigyo Hakusho (White Paper).
  30. Stiglitz, J. 1994. Whither Socialism?. The MIT Press.
  31. Takeda, S. 2001. Shinyo to shinrai no keizai gaku. NHK Books.
  32. Toya, T. 2003. Kinyuu Big Bang no Seiji Keizai Gaku (The Political Economy of the Japanese Financial Big Bang). Toyo Keizai Shimpou-Sha.
  33. Tsuru, K. 2006. Nihon no Keizai Shisutemu Kaikaku. Nihon Keizai Shimbun Sha.
  34. Uriu, R. 1999. Japan in 1998: Nowhere to Go but Up?. Asian Survey. 39(1): 114-124. https://doi.org/10.2307/2645600
  35. Williamson, O.E. 1985. The Economic Institutions of Capitalism. The Free Press.
  36. Yoshikawa, H. 1999. Tenkanki no Nihon Keizai. Iwanami.
  37. Yoshikawa, H. 2003. Kozo Kaikaku to Nihon Keizai. Iwanami.