Chapter

The Myth of the Main Bank

J. Mark Ramseyer

in The Fable of the Keiretsu

Published by University of Chicago Press

Published in print July 2006 | ISBN: 9780226532707
Published online February 2013 | e-ISBN: 9780226532721 | DOI: http://dx.doi.org/10.7208/chicago/9780226532721.003.0004
The Myth of the Main Bank

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This chapter investigates whether it is true that Japanese companies held special arrangements with banks. It summarizes the accounts of Japanese “main banks” and the “implicit main bank contract” and describes several examples of the way banks deal with troubled firms. The analysis reveals that Japanese firms have no “main bank system” and never did. The idea was popularized by economists as an anecdote on which to peg their mathematical models and was used by non-economists as yet another putatively culture-bound economic phenomenon.

Keywords: Japanese companies; main banks; troubled firms; economists; mathematical models; economic phenomenon

Chapter.  12136 words. 

Subjects: International Economics

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