Institutions, Competition, and Capital Market Integration in Japan

Kris J. Mitchener and Mari Ohnuki

No 14090, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Using a newly-constructed panel data set which includes annual estimates of lending rates for 47 Japanese prefectures, we analyze why interest rates converged over the period 1884-1925. We find evidence that technological innovations and institutional changes played an important role in creating a national capital market in Japan. In particular, the diffusion in the use of the telegraph, the growth in commercial branch banking networks, and the development of Bank of Japan's branches reduced interest-rate differentials. Bank regulation appears to have played little role in impeding financial market integration.

JEL-codes: F15 G21 N15 O16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-his and nep-reg
Date: Written 2008-06
Note: DAE
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