fable of keiretsu

Doug Henwood dhenwood at panix.com
Tue Apr 10 09:52:22 PDT 2001


[Dennis Redmond, this one's aimed at you. That evil Marxian influence is everywhere!]

"The Fable of the Keiretsu"

BY: YOSHIRO MIWA

University of Tokyo

J. MARK RAMSEYER

Harvard Law School

Document: Available from the SSRN Electronic Paper Collection:

http://papers.ssrn.com/paper.taf?abstract_id=263979

Other Electronic Document Delivery:

http://www.law.harvard.edu/programs/olin_center/

SSRN only offers technical support for papers

downloaded from the SSRN Electronic Paper Collection

location. When URLs wrap, you must copy and paste

them into your browser eliminating all spaces.

Paper ID: Harvard Law and Economics Discussion Paper No. 316

Date: March 2001

Contact: YOSHIRO MIWA

Email: Mailto:miwa at e.u-tokyo.ac.jp

Postal: University of Tokyo

7-3-1 Hongo, Bunkyo-ku

Tokyo 113-0033, JAPAN

Phone: 011-81-3-5841-5530

Fax: 011-81-3-5841-5521

Co-Auth: J. MARK RAMSEYER

Email: Mailto:ramseyer at law.harvard.edu

Postal: Harvard Law School

Cambridge, MA 02138 USA

Paper Requests:

Contact Karl Coleman, John M. Olin Center for Law, Economics,

and Business at Harvard Law School, Hauser 506, Cambridge, MA

02138. Mailto:kcoleman at law.harvard.edu Phone:(617)496-1670.

Fax:(617) 496-2256.

ABSTRACT:

Central to so many accounts of post-war Japan, the keiretsu

corporate groups have never had economic substance. Conceived by

Marxists committed to locating "domination" by "monopoly

capital," they found an early audience among western scholars

searching for evidence of culture-specific group behavior in

Japan. By the 1990s, they had moved into mainstream economic

studies, and keiretsu dummies appeared in virtually all

econometric regressions of Japanese industrial or corporate

structure. Yet the keiretsu began as a figment of the academic

imagination, and they remain that today.

The most commonly used keiretsu roster first groups large

financial institutions by their pre-war antecedents. It then

assigns firms to a group if the sum of its loans from those

institutions exceeds the amount it borrows from the next largest

lender. Other rosters start by asking whether firm presidents

meet occasionally with other presidents for lunch. Regardless of

the definition used, cross-shareholdings were trivial even

during the years when keiretsu ties were supposedly strongest,

and membership has only badly proxied for "main bank" ties.

Econometric studies basing "keiretsu dummies" on these rosters

have produced predictably haphazard results: some are a function

of misspecified equations, while others depend on outlying data

points and some are specific to one keiretsu roster but not

others. The only reliably robust results are the artifacts of

the sample biases created by the definitions themselves.



More information about the lbo-talk mailing list