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The Change of the mainbank system and corporate governance in Japan

CHEOLGU KANG 1

1고려대학교

Accredited

ABSTRACT

The purpose of this article is the Japanese mainbank system concerned with the Japanese corporate governance, which is to analyze the changed academic view observed from before and after the bubble economy. And also to analyze the significance and limits on the role of the mainbank of its underinvestment and overinvestment, during the rapid growth of Japan. For this there was an analysis on the pre-research of the general concept of what the mainbank is and the effects of it on the Japanese economy. The existence of the mainbank’s solution to the underinvestment problem was available because studies show that Japan’s economy was growing at a steady rate up to the mid 1990s. However in the late 1990s the expansion of the economic stagnation made the ability of the mainbank’s corporate governance to decrease and become doubtful of its effectiveness. Furthermore, there became a rise that the system was a downfall- making companies overinvest. Therefore, to explain the relationship between Japanese companies and the mainbank from the 1980s to the year 2000, financial statements were used to analyze all the industries and the manufacturing industries. In result, one can see that the relationship between the major companies and the mainbank weakened; however, it is noticeable that there was a restraint on underinvestment before that.

Citation status

* References for papers published after 2022 are currently being built.