Advanced Search
MyIDEAS: Login to save this paper or follow this series

What Role Can Financial Policies Play in Revitalizing SMEs in Japan?

Contents:

Author Info

  • Raphael W. Lam
  • Jongsoon Shin
Registered author(s):

    Abstract

    The paper discusses the role the financial sector can play in supporting growth in Japan. While overall credit conditions have been accommodative, credit growth has remained weak, especially for small and medium-sized enterprises (SMEs). Firm-level SME data and sectoral corporate balance sheets show that many SMEs have faced structural challenges of high leverage and low profitability. Moreover, the global financial crisis has weakened the financial position across SMEs, particularly for those with low credit worthiness. These challenges are closely related to low availability of riskcapital and the pervasiveness of credit support measures. This paper argues that to encourage the supply of risk-based capital, costly government support measures should be phased out and SME restructuring be accelerated. Efforts are also needed to deepen capital markets to enhance risk capital availability and address regulatory barriers to starting businesses. In that regard, addressing SMEweaknesses would improve private investment, enhance firm productivity, and lift growth.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=40157
    Download Restriction: no

    Bibliographic Info

    Paper provided by International Monetary Fund in its series IMF Working Papers with number 12/291.

    as in new window
    Length: 24
    Date of creation: 11 Dec 2012
    Date of revision:
    Handle: RePEc:imf:imfwpa:12/291

    Contact details of provider:
    Postal: International Monetary Fund, Washington, DC USA
    Phone: (202) 623-7000
    Fax: (202) 623-4661
    Email:
    Web page: http://www.imf.org/external/pubind.htm
    More information through EDIRC

    Order Information:
    Web: http://www.imf.org/external/pubs/pubs/ord_info.htm

    Related research

    Keywords: Corporate sector; Japan; Financial sector; Credit policy; financial institutions; sme financing; sme sector; firm size; medium enterprises; small firms; capital markets; venture capital; small and medium enterprises; business registration; small enterprises; small business; small businesses; corporate performance; corporate debt; large enterprises; corporate governance; initial public offerings; entrepreneurs; corporate bond; corporate restructuring;

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Uesugi, Iichiro & Sakai, Koji & Yamashiro, Guy M., 2008. "The Effectiveness of Public Credit Guarantees in the Japanese Loan Market," PIE/CIS Discussion Paper, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University 400, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    2. ONO Arito & SAKAI Koji & UESUGI Iichiro, 2008. "The Effects of Collateral on SME Performance in Japan," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 08037, Research Institute of Economy, Trade and Industry (RIETI).
    3. Ricardo J. Caballero & Takeo Hoshi & Anil K. Kashyap, 2008. "Zombie Lending and Depressed Restructuring in Japan," American Economic Review, American Economic Association, American Economic Association, vol. 98(5), pages 1943-77, December.
    4. Stefan Arping & Gy�ngyi L�r�nth & Alan Morrison, 2009. "Public Initiatives to Support Entrepreneurs: Credit Guarantees versus Co-Funding," Tinbergen Institute Discussion Papers 09-019/2, Tinbergen Institute.
    5. Ichiro Tokutsu & Kazuo Ogawa & Mika Saito, 2012. "Japan out of the Lost Decade," IMF Working Papers 12/171, International Monetary Fund.
    6. Koji Sakai & Iichiro Uesugi & Tsutomu Watanabe, 2005. "Firm Age and the Evolution of Borrowing Costs: Evidence from Japanese Small Firms," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 05026, Research Institute of Economy, Trade and Industry (RIETI).
    7. KWON Hyeog Ug & NARITA Futoshi & NARITA Machiko, 2009. "Resource Reallocation and Zombie Lending in Japan in the '90s," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 09052, Research Institute of Economy, Trade and Industry (RIETI).
    8. Uesugi, Iichiro, 2008. "Efficiency of Credit Allocation and Effectiveness of Government Credit Guarantees: Evidence from Japanese Small Businesses," PIE/CIS Discussion Paper, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University 353, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:12/291. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jim Beardow) or (Hassan Zaidi).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.