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Unformatted text preview: or managers (e.g. higher pay for
higher risk, resulting in greater inequality of pay
(iii) a breakdown of relational finance (the mainbank system) would remove one source of
information flows which overcome capitalmarket asymmetries and would require a differently functioning capital market to replace
them; Aoki and Serdar (2000) argue that there
is still a logic to the persistence of relational
finance and OECD (1996) found little evidence
of breakdown of the main-bank system.
The conclusion emerging from the papers in this
issue and from other studies, is that the various
interrelated aspects of the ‘Japanese model’ are
each changing to some degree. However, the linkages between these aspects mean that rapid change
would raise a legitimate concern about ‘unravelling’
the system and losing many of its strengths as well
as repairing its weaknesses. The pace of change
may speed up, either intentionally or unintentionally,
depending on how soon the economy returns to
positive growth. But th...
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This note was uploaded on 02/03/2014 for the course ECON 204 taught by Professor Devero during the Summer '13 term at American University of Sharjah.
- Summer '13