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Investor Rights in Historical Perspective: Globalization and the Future of the Japanese Firm and Financial System


  • Juro Teranishi

    (Institute of Economic Research, Hitotsubashi University, Naka 2-1 Kunitachi, Tokyo, Japan 186-0042.)


The evolution of investor rights in Japan is examined in relation to the evolution in firm-specific skill formation. Asset holders (shareholders and landlords) delegated part of the control of their assets to actual producers (managers, workers, and tenant farmers) to maximize the benefits of firm-specific skill formation by the producers. A cautious approach is therefore needed in adjusting investor rights in Japan to global standards: stronger investor rights could enhance allocative efficiency of financial resources, but they could also be harmful to organizational efficiency based on investment by employees in firm-specific skills. (c) 2006 The Earth Institute at Columbia University and the Massachusetts Institute of Technology.

Suggested Citation

  • Juro Teranishi, 2006. "Investor Rights in Historical Perspective: Globalization and the Future of the Japanese Firm and Financial System," Asian Economic Papers, MIT Press, vol. 5(1), pages 36-63, Winter.
  • Handle: RePEc:tpr:asiaec:v:5:y:2006:i:1:p:36-63

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