IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Comparative Study of Regional Finance and Industrial Partnerships in Japan and South Korea - Comparison of the Taegu and North Gyeongsang regions of South Korea and the Tokai and Kansai regions of Japan based on corporate questionnaire surveys (Japanese)

Listed author(s):
  • YAMORI Nobuyoshi
  • HIRAKAWA Hitoshi
  • CHOI Yong-Ho
  • JIN Byung-Yong
  • BU Gi-Duck
  • PARK Man-Bong

Professor Yamori has in the past conducted questionnaires about the Tokai (Tawada and Yamori: 2005) and Kansai regions (Tawada and Yamori: 2008) as a means of acquiring insight into the realities of finance for small and medium enterprises (SMEs) in Japan. Now, with the cooperation of Daegu Bank Economic Research Division(the leading independent regional bank in South Korea) and Professor CHOI Yong-Ho of Kyungpook National University of South Korea, a questionnaire on finance and industrial collaboration among SMEs in the Taegu and North Gyeongsang regions (the regions that encompass Taegu, the third largest city in South Korea), has been conducted. This research paper identifies both commonalities and differences between Japan and South Korea by using the results of the survey and comparing them with those obtained from previous surveys conducted in Japan. This latest questionnaire can be summarized as follows. Questionnaires were sent on August 8, 2007 to 2,500 companies (1,250 companies in Taegu and 1,250 companies in North Gyeongsang), randomly selected from 65,535 companies located in the two regions. Of these companies, 257 companies (134 companies in Taegu and 123 companies in North Gyeongsang), or 10% of the total number of companies that received the questionnaire, had responded by the end of September. The questionnaires consisted of 51 questions in total. Questions 1 and 2 asked about the attributes of respondents, while questions 3 through 14 related to the general status of the responding companies. Questions 15 through 34 asked about matters related to the financial institutions the respondents dealt with, while questions 35 through 42 covered items associated with the industrial cluster in the Taegu and North Gyeongsang regions. Finally, questions 43 through 51 covered financing and the use of financial institutions in the regions. As a result, both commonalities and differences between Japan and South Korea have become apparent. The general finding from the above survey was the fact that regional financial systems in Japan and South Korea are very similar. For example, an overwhelming majority of SMEs in the United States deal with only one bank, while it has become apparent that SMEs in Japan and South Korea commonly deal with a number of banks. Consequently, the practice of dealing with a number of banks in Japan should not be regarded as something uniquely Japanese but rather considered to be a natural outcome of the particular social, economic, and legal systems. In contrast, despite the fundamental similarities in the financial systems of Japan and South Korea, a number of differences have also been identified. For example, responding to a question about the positive aspects of current financial institutions, the provision of funds was more important to companies in the Taegu and North Gyeongsang regions, while the financial institutions' knowledge about the respondent's company was more important for companies in the Kansai and Tokai regions in Japan. In addition, with respect to the question about what kinds of services responding companies expect from banks, Japanese companies look for banks to provide extensive information associated with funding, in addition to the funding itself, while companies in South Korea valued the actual provision of funds. These differing mindsets appeared to primarily reflect the difference in the extent of damage from the currency crisis that took place in the late 1990s, and variations in the progress of economic development in Japan and South Korea; namely, while companies in South Korea have many investment opportunities, Japanese companies have already built up their internal reserves and have reached the stage of maturity. Based on these differences, there is likely much that the two countries can learn from one other. Moreover, through this research, universal phenomena applicable to broader regional finance were also identified. For example, it has been pointed out that financial institutions and companies in the United States and Europe maintain a very close physical distance even in this age of highly advanced information technologies (Degryse and Ongena [2004]). Based on this research, it was confirmed that SMEs in Japan and South Korea also favor dealing with local banks. At present, the division of the financial market for SMEs into local regions is considered a universal phenomenon. The following section of this paper explains the purpose and outline of this questionnaire. Then sections three through six present and analyze all questionnaire responses and finally, the seventh section summarizes the results of this paper.

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:
Download Restriction: no

Paper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Policy Discussion Papers (Japanese) with number 08006.

in new window

Length: 72 pages
Date of creation: Sep 2008
Handle: RePEc:eti:rpdpjp:08006
Contact details of provider: Postal:
11th floor, Annex, Ministry of Economy, Trade and Industry (METI) 1-3-1, Kasumigaseki Chiyoda-ku, Tokyo, 100-8901

Phone: +81-3-3501-1363
Fax: +81-3-3501-8577
Web page:

More information through EDIRC

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:eti:rpdpjp:08006. 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: (NUKATANI Sorahiko)

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.