Corporate governance in Japan : institutional change and organizational diversity / edited by Masahiko Aoki, Gregory Jackson, Hideaki Miyajima.

Includes bibliographical references and index.

Cover -- Contents -- Preface -- 1. Introduction: The Diversity and Change of Corporate Governance in Japan -- PART I: CHANGES IN OWNERSHIP AND FINANCE -- 2. Relationship Banking in Post-Bubble Japan: Coexistence of Soft- and Hard-Budget Constraints -- 3. The Unwinding of Cross-Shareholding in Japan: Causes, Effects, and Implications -- 4. Foreign Investors and Corporate Governance in Japan -- 5. Venture Capital and its Governance: The Emergence of Equity Financing Conduits in Japan -- 6. Corporate Governance in Financial Distress: The New Role of Bankruptcy -- 7. The Rise of Bank-Related Corporate Revival Funds -- PART II: CHANGES IN ORGANIZATION, EMPLOYMENT, AND CORPORATE BOARDS -- 8. Business Portfolio Restructuring of Japanese Firms in the 1990s: Entry and Exit Analysis -- 9. Corporate Finance and Human Resource Management in Japan -- 10. Employment Adjustment and Distributional Conflict in Japanese Firms -- 11. The Turnaround of 1997: Changes in Japanese Corporate Law and Governance -- 12. The Performance Effects and Determinants of Corporate Governance Reform -- 13. Insider Management and Board Reform: For Whose Benefit? -- PART III: DIVERSITY AND INSTITUTIONAL CHANGE -- 14. Organizational Diversity and Institutional Change: Evidence from Financial and Labor Markets in Japan -- 15. Conclusion: Whither Japan's Corporate Governance?

This book uses comparative institutional analysis to explain differences in national economic performance. Countries have their own rules for corporate governance and they have different market arrangements; and these differences in rules and organization affect the way firms behave. Countries also tend to develop conventions of organizational architechture of firms, whether their hierarchies are functional, horizontal, or decentralized. This affects the way in which they process information, and information management is increasingly seen as being of crucial importance to a firm's performance. Aoki accords more importance to these factors than to the factors conventionally used in applying a neoclassical model of economic efficiency. He applies game theory, contract theory, and information theory. By describing the rules and norms in Japan, the USA, and the transitional economies, Aoki shows how firms can achieve competitive advantage in international markets if these conventions and rules are well suited to the industrial sector in which the firms operate. He is particularly concerned with how Japan, with its main bank and lifelong employment systems, as well as information-sharing firm organizational structure, might reform its institutions to maintain competitive advantage in the world economy.