Do Keiretsu Really Hinder FDI into Japanese Manufacturing?

Kimino, Satomi; Driffield, Nigel; Saal, David

Abstract

This paper examines an issue that has received considerable comment but little analysis. It has often been argued that the presence of the keiretsu in Japan has been instrumental in deterring multinational firms from entering Japan, though evidence for this is patchy. We present some new analysis of this issue, thereby evaluating the effects of keiretsu on inward investment penetration in Japan. In contrast to previous work in this area, our results suggest that there is little relationship between inward FDI and keiretsu networks, once one controls for endogeneity and unobservable heterogeneity. The results illustrate some important interaction effects between keiretsu and other explanatory variables that explain differences in inward investment penetration. © 2012 Copyright International Journal of the Economics of Business.

Citation

Kimino, S., Driffield, N., & Saal, D. (2012). Do Keiretsu Really Hinder FDI into Japanese Manufacturing?. International journal of the economics of business, 19(3), 377-395. https://doi.org/10.1080/13571516.2012.715273

• Journal Article Type: Article
• Online Publication Date: Oct 24, 2012
• Publication Date: Nov 1, 2012
• Deposit Date: Jun 20, 2019
• Journal: International Journal of the Economics of Business
• Print ISSN: 1357-1516
• Publisher: Routledge
• Peer Reviewed: Peer Reviewed
• Volume: 19
• Issue: 3
• Pages: 377-395
• DOI: https://doi.org/10.1080/13571516.2012.715273
• Keywords: Keiretsu; FDI; Market Structure JEL classifications: F23, L60 L41
• Public URL: https://hull-repository.worktribe.com/output/1440393
• Publisher URL: https://www.tandfonline.com/doi/full/10.1080/13571516.2012.715273