Abstract
As the ownership structure of Japanese corporations has changed dramatically during the 1990s, this chapter examines the causes and consequences of the decline in cross-shareholding. Using detailed and comprehensive data on ownership structure, including data on individual cross-shareholding relationships and other variables (Tobin's q) developed by the Nissai Life Insurance Research Institute and Waseda University, the chapter highlights the determinants of the choice between holding or selling shares for both banks and firms. Profitable firms with easy access to capital markets and a high level of foreign ownership prior to the banking crisis tended to unwind cross-shareholdings, while low-profit firms which had difficulty accessing capital markets and low foreign ownership tended to keep cross-shareholding with banks. High institutional shareholding and, surprisingly, block shareholding have had positive effects on firms' performance, while bank ownership has had consistently negative effects on firm performance. The result has been a growing diversity of ownership patterns among Japanese firms.
| Original language | English |
|---|---|
| Title of host publication | Corporate Governance in Japan: Institutional Change and Organizational Diversity |
| Publisher | Oxford University Press |
| ISBN (Print) | 9780191713705, 9780199284511 |
| DOIs | |
| Publication status | Published - 2007 Sep 1 |
| Externally published | Yes |
Fingerprint
Keywords
- Corporate governance
- Cross-shareholding
- Japanese economy
- Keiretsu
- Main bank
- Networks
- Stock market valuation
ASJC Scopus subject areas
- Economics, Econometrics and Finance(all)
Cite this
The Unwinding of Cross-Shareholding in Japan : Causes, Effects, and Implications 1. / Miyajima, Hideaki; Kuroki, Fumiaki.
Corporate Governance in Japan: Institutional Change and Organizational Diversity. Oxford University Press, 2007.Research output: Chapter in Book/Report/Conference proceeding › Chapter
}
TY - CHAP
T1 - The Unwinding of Cross-Shareholding in Japan
T2 - Causes, Effects, and Implications 1
AU - Miyajima, Hideaki
AU - Kuroki, Fumiaki
PY - 2007/9/1
Y1 - 2007/9/1
N2 - As the ownership structure of Japanese corporations has changed dramatically during the 1990s, this chapter examines the causes and consequences of the decline in cross-shareholding. Using detailed and comprehensive data on ownership structure, including data on individual cross-shareholding relationships and other variables (Tobin's q) developed by the Nissai Life Insurance Research Institute and Waseda University, the chapter highlights the determinants of the choice between holding or selling shares for both banks and firms. Profitable firms with easy access to capital markets and a high level of foreign ownership prior to the banking crisis tended to unwind cross-shareholdings, while low-profit firms which had difficulty accessing capital markets and low foreign ownership tended to keep cross-shareholding with banks. High institutional shareholding and, surprisingly, block shareholding have had positive effects on firms' performance, while bank ownership has had consistently negative effects on firm performance. The result has been a growing diversity of ownership patterns among Japanese firms.
AB - As the ownership structure of Japanese corporations has changed dramatically during the 1990s, this chapter examines the causes and consequences of the decline in cross-shareholding. Using detailed and comprehensive data on ownership structure, including data on individual cross-shareholding relationships and other variables (Tobin's q) developed by the Nissai Life Insurance Research Institute and Waseda University, the chapter highlights the determinants of the choice between holding or selling shares for both banks and firms. Profitable firms with easy access to capital markets and a high level of foreign ownership prior to the banking crisis tended to unwind cross-shareholdings, while low-profit firms which had difficulty accessing capital markets and low foreign ownership tended to keep cross-shareholding with banks. High institutional shareholding and, surprisingly, block shareholding have had positive effects on firms' performance, while bank ownership has had consistently negative effects on firm performance. The result has been a growing diversity of ownership patterns among Japanese firms.
KW - Corporate governance
KW - Cross-shareholding
KW - Japanese economy
KW - Keiretsu
KW - Main bank
KW - Networks
KW - Stock market valuation
UR - http://www.scopus.com/inward/record.url?scp=84920079885&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=84920079885&partnerID=8YFLogxK
U2 - 10.1093/acprof:oso/9780199284511.003.0003
DO - 10.1093/acprof:oso/9780199284511.003.0003
M3 - Chapter
AN - SCOPUS:84920079885
SN - 9780191713705
SN - 9780199284511
BT - Corporate Governance in Japan: Institutional Change and Organizational Diversity
PB - Oxford University Press
ER -