IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

A Reconsideration of the Rationale for Bank-Centered Economic Systems and the Effectiveness of Directed Credit Policies in the Light of Japanese Evidence

  • Richard A. Werner
Registered author(s):

    Directed credit is seen by recent literature as having contributed to high post-war economic growth in several Asian countries, including Japan, Korea, Taiwan, Thailand, and Indonesia. Its use, however, remains controversial. This paper adopts ex ante predictive power as criterion for the evaluation of the usefulness of theories and policies. For this purpose it attempts to identify the historical rationale of the credit direction policies adopted by Japan—the East Asian country that developed earliest and most successfully. It is found that Japan's directed credit policymakers modeled their system on the practice of the Reichsbank, under its president Hjalmar Schacht in the 1920s, and the economic thought of German development economists at the time, who argued for a strong role of banks as conduits of official guidance within an overall growth-oriented institutional design. This paper provides some support for directed credit policies and offers an alternative explanation for the emergence of a bank-based financial system in Japan and other countries.

    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://mesharpe.metapress.com/link.asp?target=contribution&id=W553633262147Q51
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Article provided by M.E. Sharpe, Inc. in its journal Japanese Economy.

    Volume (Year): 30 (2002)
    Issue (Month): 3 (May)
    Pages: 3-45

    as
    in new window

    Handle: RePEc:mes:jpneco:v:30:y:2002:i:3:p:3-45
    Contact details of provider: Web page: http://mesharpe.metapress.com/link.asp?target=journal&id=110911

    No references listed on IDEAS
    You can help add them by filling out this form.

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

    When requesting a correction, please mention this item's handle: RePEc:mes:jpneco:v:30:y:2002:i:3:p:3-45. 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: (Chris Nguyen)

    The email address of this maintainer does not seem to be valid anymore. Please ask Chris Nguyen to update the entry or send us the correct address

    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.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.