Monitoring the Monitors: Amakudari and the Ex-Post Monitoring of Private Banks

Wolter Hassink and Adrian Rixtel ()

No 1785, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: The paper investigates whether the Japanese monetary authorities use post-retirement employment of Ministry of Finance (MoF) and Bank of Japan (BoJ) officials as a policy instrument. The authors also investigate whether industrial groupings (keiretsu) and main banks have monitoring functions. They find that MoF and BoJ retirees do move into banks that perform badly in terms of profitability. Furthermore, the paper concludes that the movement of these retirees into the boards of private banks is positively related to specific main bank relationships. The hypothesis of monitoring by keiretsu is rejected, however. Finally, the paper finds that MoF/BoJ amakudari appointments have a positive impact on the development of lending to risky industries. In particular, this latter finding casts doubts on the credibility of the hypothesis that amakudari is used as an instrument of prudential policy.

Keywords: Amakudari; Corporate Governance; Monitoring; prudential policy (search for similar items in EconPapers)
JEL-codes: E58 G30 G38 (search for similar items in EconPapers)
Date: 1998-01
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=1785 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:1785

Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... ers/dp.php?dpno=1785

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().