International Journal of Business

Do Japanese Banks Change Their Lending Behavior to Dull Industries? A Comparison with the Bubble Period

This paper investigates whether Japanese banks have improved their lending behavior to the real estate industry, construction industry, and distributor-retailers, all of which it is believed have been recipients of additional lending even after the collapse of the bubble (known as "OIGASHI" in Japanese). Specifically, the relationship between the increase in the lending balances to those industries in the second half of the 1980s and the increase in the beginning of the 1990s is analyzed. Als...

Does the Japanese Closed-End Fund Puzzle Exist? An Empirical Study of the Efficiency of the Financial Market in Japan

This paper examines the efficiency of the Japanese financial market from the point of divergence of the net asset values of an ETF (Exchange Trade Fund) and its prices. "Discounts," which mean the ETF price is lower than its net asset value per share, were found on the average, and no co-integration relationships between the two variables were observed, implying that arbitrage opportunities exist. Furthermore, a correlation between the changes in the discount rates and the small capital stock...

Recent Fundamental Reform of Public Financial System in Japan: Background and Remaining Problems

Public financial system has played a crucial role in the Japanese economy. In this paper, we discuss the recent drastic reform of the public financial system in Japan. After describing the former system and the background that led to the 2001 reform, we examine the features and remaining problems of the new system. At the same time, we would like to mention issues of entire financial system in Japan, which seems to be a bottleneck for realizing an ideal public financial system.

Recent Japanese Monetary Policy: An Evaluation of the Quantitative Easing

Japan has experienced unprecedented recession and deflation for more than 10 years, while aggressive fiscal policy was conducted under severe budget constraint during the 1990s and the Bank of Japan enforced unprecedented monetary easing, which reduced interbank interest rates to almost zero. However, because these policies were not enough to end deflation, since 2001, the Bank of Japan has implemented quantitative easing. Even now, there is much dispute over whether the quantitative easing h...

The Changing Structure of Cost for Japanese Securities Firms

Japanese securities firms were operating under new circumstances after the Japanese version of the Financial Big Bang was implemented. This paper examines structural changes in the Japanese securities industry by comparing the economies of scale and scope between 1998 and 2002. In particular, we focus on the online securities firms that have appeared in recent years and verify their differences from the existing ones or the impact of deregulation. This is undertaken by employing the generaliz...

Trading Company Finance in Japan

Japan's general trading companies play a major role in assisting the financing needs of their customers through a variety of financial instruments, including trade credit. In this paper we investigate the determinants of trading company finance. The main contributions of this paper are twofold. First, we find that although trading company finance is now less dependent on trade credit, its response to output shocks is still defined by its trade credit component. This provides evidence that tra...

Special Issue On Contemporary Japanese Economy and Financial Markets