Policy Research Domains (Adjacent Basic Research Areas) A. Institutions Related to Financial and Labor Markets, and New Corporate Law and Governance

Enterprise Law Project - Institutional complementarities among markets and laws
(Formerly known as The "Enterprise Law" as an Infrastructure for the Incentive Bargain of the Firm)

Project Leader/Sub-Leader


SHISHIDO Zenichi Faculty Fellow



2009 - 2010

A firm is an incentive mechanism among those indispensable capital providers, i.e., shareholders and creditors as monetary capital providers, and management and employees as human capital providers. Markets and laws are two significant aspects of the infrastructure of the incentive bargaining of a firm. It is important to note that the law does not by itself affect the incentive bargaining among those four players, but rather affects it complementarily through markets. Also a specific law in many cases would not affect incentive bargaining independently, but rather complementarily through laws. The objectives of this project are to reconstruct legal systems such as the enterprise law, which affect the incentive bargaining of a firm, and to stimulate efficient incentive bargaining at the firm level.

2007 - 2008

We have frequently discussed the question, "To whom does the company belong" in corporate governance theories. However, henceforth, it will be necessary to engage in this discussion from a different perspective: that is, what is the optimal incentive mechanism for the providers of the essential resources needed in corporate activities (managers and employees as human capital providers and shareholders and creditors as monetary capital providers. The legal system is a key part of the infrastructure that affects the outcome of incentive bargaining. However, because the legal system consists of numerous sub-divisions, no attempt has been made in the past to deal with "enterprise law" as an integrated incentive structure. In this project, Japanese and foreign experts are brought together to undertake a restatement of enterprise law, covering corporate law, insolvency law, securities law, labor law and tax law.

April 11, 2007 - November 30, 2010

Major Research Results


RIETI Discussion Papers


Project URL


RIETI Seminar

RIETI International Seminar

Project URL


RIETI Policy Discussion Papers

Project URL