Capital Markets and Corporate Governance in Japan, Germany, and the United States: Organizational Response to Market Inefficiencies

By Helmut M. Dietl | Go to book overview

INTRODUCTION

Germany, Japan, and the United States represent the world’s three largest economies. Despite their common economic success, German, Japanese and US companies operate within rather unique financial systems. Germany’s financial system is dominated by large universal banks. Markets for corporate stocks and corporate bonds are not well developed. Corporate ownership is highly concentrated. Nonfinancial enterprises are the most important group of shareholders.

Banks play a dominant role within the Japanese financial system. Although they are not allowed to acquire more than 5 percent of a corporation’s outstanding shares, Japanese banks own more than one-fifth of all Japanese stocks. They are the center of keiretsu organizations—large financial networks based on cross shareholdings, short-term credits, long-term commitments, director interlinkages and inter-firm trading.

The US capital market is well developed. Bank intermediation is less important than in Germany and Japan. Corporate ownership is highly fragmented. Private households constitute the largest group of shareholders, owning about three-quarters of all US stocks. Despite the strength of US stock and bond markets, multidivisional organization has become popular in the United States. Like their German and Japanese counterparts, many US corporations have created internal capital markets by adopting a multidivisional structure. Contrary to German and Japanese multidivisional corporations, however, US conglomerates became the target of leveraged buyouts. During the 1980s a large number of US corporations were restructured as a result of hostile takeovers.

These differences raise various questions. For example, why are holding companies popular in Germany? Why did financial keiretsu develop in Japan, but not in Germany and the United States? Why is bank intermediation more dominant in Germany and Japan than in

-1-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited page

Bookmark this page
Capital Markets and Corporate Governance in Japan, Germany, and the United States: Organizational Response to Market Inefficiencies
Table of contents

Table of contents

  • Title Page iii
  • Contents v
  • Illustrations vi
  • Acknowledgements viii
  • Introduction 1
  • 1 - Theoretical Framework 4
  • 2 - Empirical Evidence from Germany, Japan and the United States 111
  • Summary 161
  • Appendices 166
  • Notes 170
  • Bibliography 182
  • Name Index 190
  • Subject Index 193
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this book
  • Bookmarks
  • Highlights & Notes
  • Citations
/ 200

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.