Hostname: page-component-8448b6f56d-jr42d Total loading time: 0 Render date: 2024-04-17T21:44:22.746Z Has data issue: false hasContentIssue false
  • English
  • Français

The Organization of Enterprise in Japan

Published online by Cambridge University Press:  04 June 2015

Tom Nicholas
Tom Nicholas*
Affiliation:
William J. Abernathy Professor of Business Administration in the Entrepreneurial Management Group, Harvard Business School, Soldiers Field Road, Boston, MA 02163. E-mail: tnicholas@hbs.edu.
Get access Rights & Permissions [Opens in a new window]

Abstract

Recent research indicates the joint stock form was not a superior type of business organization in many countries historically. In Japan, however, its role was more pervasive. From 1896 to 1939 joint stock enterprises accounted for 44 percent of registered businesses and 80 percent of total capital. From 1922 to 1939 these enterprises outperformed other forms and generated 94 percent of aggregate profits. External finance factors, Japan's development phase, industrial structure, public policy, and culture led to high joint stock usage. The private limited liability company, introduced in 1938, did not displace the joint stock form.

Type
Articles
Information
The Journal of Economic History , Volume 75 , Issue 2 , June 2015 , pp. 333 - 363
Copyright
Copyright © The Economic History Association 2015 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

For many extremely helpful comments and suggestions I thank the anonymous referees, the editors of this journal, Joan Farre-Mensa, Les Hannah, Naomi Kodama, Ramana Nanda, Nobuyuki Tamai, and Akiko Kanno and Mayuka Yamazaki from Harvard Business School's Japan Research Center in Tokyo. The Division of Research and Faculty Development at Harvard Business School provided funding.

References

REFERENCES

Asagi, Shin-ichi. “Historical Review of the Corporate Law Revisions of Showa 13, Part 3: An Historical Perspective on the Events Leading to the Enactment of the Yugen Kaisha Laws in Japan.” [Showa 13-nen Kaisha-hou Kaisei no Rekishi-teki Tenkai: Dai-3-bu - Honpou Yugen Kaisha-hou Seitei Shoushi] The Law and Politics Review [Kobe Gakuin Hougaku] 25, no. 3 (1995): 1–57.Google Scholar
Asker, John, Farre-Mensa, Joan, and Ljungqvist, Alexander. “Comparing the Investment Behavior of Public and Private Firms.” New York University Working Paper, 2013.Google Scholar
Banz, Rolf W. “The Relationship Between Return and Market Value of Common Stock.” Journal of Financial Economics 9, no. 1 (1981): 3–18.Google Scholar
Baum, Harald, and Takahashi, Eiji. “Commercial and Corporate Law in Japan.” In History of Law in Japan Since 1868, edited by Röhl, Wilhelm, 330–401. Leiden and Boston: Brill Academic Publishers, 2005.Google Scholar
Braguinsky, Serguey, Ohyama, Atsushi, Okazaki, Tetsuji et al. “Acquisitions, Productivity, and Profitability: Evidence from the Japanese Cotton Spinning Industry.” University of Chicago Working Paper, 2014.Google Scholar
Chandler, Alfred D. Jr. The Visible Hand. Cambridge, MA: Harvard Belknap, 1977.Google Scholar
Chandler, Alfred D. Jr., Amatori, Franco, and Hikino, Takashi, eds. Big Business and the Wealth of Nations. Cambridge, MA: Cambridge University Press, 1997.Google Scholar
Cochran, Thomas. “The Business Revolution.” American Historical Review 79, no. 1 (1977): 449–66.Google Scholar
De Becker, Joseph Ernest. Commentary on the Commercial Code of Japan. London: Gale, 1913.Google Scholar
Faccio, Mara, Marchica, Maria-Teresa, McConnell, John J. et al. “Returns and Risks to Private Equity.” Purdue University Working Paper, 2012.Google Scholar
Fama, Eugene F., and French, Kenneth R., “Size and Book-to-Market Factors in Earnings and Returns.” Journal of Finance 50, no. 1 (1995): 131–55.Google Scholar
Frankl, Jennifer L., “An Analysis of Japanese Corporate Structure, 1915-1937.” The Journal of Economic History 59, no. 4 (1999): 997–1015.Google Scholar
Franks, Jullian, Mayer, Colin, and Miyajima, Hideaki. “The Ownership of Japanese Corporations in the 20th Century.” Review of Financial Studies, 27, no. 9 (2014): 2580–2625.Google Scholar
Fruin, Mark. The Japanese Enterprise System: Competitive Strategies and Cooperative Structures. Oxford: Clarendon Press, 1992.Google Scholar
Guinnane, Timothy, Harris, Ron, Lamoreaux, Naomi R. et al. “Putting the Corporation in its Place.” Enterprise and Society 8, no. 3 (2007): 687–729.Google Scholar
Haltiwanger, John. “Job Creation and Firm Dynamics in the United States.” Innovation Policy and the Economy 12, no. 1 (2012): 17–38.Google Scholar
Hamao, Yasushi, Hoshi, Takeo, and Okazaki, Tetsuji. “Listing Policy and Development of the Tokyo Stock Exchange in the Pre-War Period.” In Financial Sector Development in the Pacific Rim, edited by Ito, Takatoshi and Rose, Andrew K., 51–87. Chicago: University of Chicago Press, 2009.Google Scholar
Hang, Yang Yin. The Commercial Code of Japan: Translated. Boston: Boston Book Company, 1911.Google Scholar
Hannah, Leslie. “A Global Corporate Census: Publicly-Traded and Close Companies in 1910.” Economic History Review, forthcoming, 2015.Google Scholar
Hannah, Leslie. “Quoted Corporations, Private (Close) Companies and Limited Partnerships: An Historical Comparison of Japan with the US, Germany, Switzerland and the UK, 1899-1999.” LSE Working Paper, 2014.Google Scholar
Hayashi, Fumio, and Prescott, Edward C.. “The Depressing Effect of Agricultural Institutions on the Prewar Japanese Economy.” Journal of Political Economy 116, no. 4 (2008): 573–62.Google Scholar
Hoshi, Takeo, and Kashyap, Anil K.. “Japan's Financial Crisis and Economic Stagnation.” Journal of Economic Perspectives, 18, no. 1 (2004): 3–26.Google Scholar
Japanese Governmental Reports. Statistical Report of the Ministry of Agriculture and Commerce [Noushoumu Toukei-hyo] and the Report on Business Companies [Kaisha Toukei-hyo]. Editions from 1896 to 1939.Google Scholar
Kelley, Allen C., and Williamson, Jeffrey G.. Lessons from Japanese Development. Chicago: University of Chicago Press, 1974.Google Scholar
Kuran, Timur. “The Absence of the Corporation in Islamic Law: Origins and Persistence.” The American Journal of Comparative Law 53, no. 4 (2005): 785–834.Google Scholar
La Porta, Rafael, Lopez-de-Silanes, Florencio, and Shleifer, Andrei. “The Economic Consequences of Legal Origins.” Journal of Economic Literature 46, no. 2 (2008): 285–332.Google Scholar
Loughran, Tim, and Ritter, Jay R. “The Operating Performance of Firms Conducting Seasoned Equity Offerings.” Journal of Finance 52, no. 5 (1997): 1823–50.Google Scholar
Matsui, Tomoyo. “Corporate Governance and Closely-held Companies in Japan: The Untold Story.” In Corporate Governance in the 21st Century. Japan's Gradual Transformation, edited by Nottage, Luke, Wolff, Leon, and Anderson, Kent, 108–28. London: Edward Elgar Publishing, 2008.Google Scholar
Mitchener, Kris, and Ohnuki, Mari. “Institutions, Competition and Capital Market Integration in Japan.” The Journal of Economic History 69, no. 1 (2009): 138–71.Google Scholar
Miwa, Yoshiro, and Mark Ramseyer, J.. “Banks and Economic Growth: Implications from Japanese History.” Journal of Law and Economics 45, no. 1 (2002): 127–64.Google Scholar
Morck, Randall, and Nakamura, Masao. “Business Groups and the Big Push: Meiji Japan's Mass Privatization and Subsequent Growth.” Enterprise and Society 8, no. 3 (2007): 543–601.Google Scholar
Morikawa, Hidemasa. Zaibatsu: The Rise and Fall of Family Enterprise Groups in Japan. Tokyo: University of Tokyo Press, 1992.Google Scholar
Mosk, Carl. Japanese Industrial History: Technology, Urbanization, and Economic Growth. Armonk, NY: M.E. Sharpe, 2001.Google Scholar
Nakamura, Takafusa. “The Age of Turbulence: 1937-54.” In The Economic History of Japan: 1600-1990, edited by Nakamura, Takafusa and Odaka, Konosuke, 55–110. Oxford: Oxford University Press, 2003.Google Scholar
Nicholas, Tom. “The Origins of Japanese Technological Modernization.” Explorations in Economic History 48, no. 2 (2011): 272–91.Google Scholar
Officer, Lawrence H., and Williamson, Samuel H.. “What was the GDP, CPI, Wage or Population of Japan Then?” Measuring Worth, 2013. http://measuringworth.com/datasets/japandata/result.php (accessed 19 February 2015).Google Scholar
Okazaki, Tetsuji. “The Role of Holding Companies in Pre-War Japanese Economic Development: Rethinking Zaibatsu in Perspectives of Corporate Governance.” Social Science Japan Journal 4, no. 2 (2001): 243–68.Google Scholar
Owen, Thomas C. The Corporation Under Russian Law, 1800-1917: A Study in Tsarist Economic Policy. Cambridge: Cambridge University Press, 1991.Google Scholar
Rajan, Raghuram, and Zingales, Luigi. “The Great Reversals: The Politics of Financial Development in the Twentieth Century.” Journal of Financial Economics 69, no. 1 (2003): 5–50.Google Scholar
Shimada, Masakazu. “The Tensions between the Open Market Model and Closed ‘Zaibatsu’ Model.” Bunkyo Gakuin University Working Paper, 2012.Google Scholar
Shimizu, Takashi. “Organizations, Corporations and Shareholders: An Organizational Analysis of the Legal Structure of Business Entities.” Tokyo University Working Paper, 2012.Google Scholar
Shishido, Zenichi. “Reform in Japanese Corporate Law and Corporate Governance: Current Changes in Historical Perspective.” The American Journal of Comparative Law 549 (2001): 653–78.Google Scholar
Tang, John P. “Technological Leadership and Late Development: Evidence from Meiji Japan, 1868-1912.” Economic History Review 64, Supplement s1 (2011): 99–116.Google Scholar
Wray, William D. Mitsubishi and the N.Y.K., 1870-1914: Business Strategy in the Japanese Shipping Industry. Cambridge, MA: Harvard University Press, 1984.Google Scholar