International Transmission of the 2008-09 Financial Crisis: Evidence from Japan

Author Name HOSONO Kaoru (Gakushuin University) / TAKIZAWA Miho (Toyo University) / TSURU Kotaro (Faculty Fellow, RIETI)
Creation Date/NO. February 2013 13-E-010
Research Project Reform of Labor Market Institutions
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We investigate the international transmission of the financial crisis in 2008-2009 to Japanese firms by examining both the stock price responses to the crisis events and the changes in operating performance subsequent to the crisis. Both the stock price responses and ex-post operating performance consistently indicate that the crisis hit Japanese firms through the trade and liquidity channels. The quantitative effects of the two channels, however, differ between the two performance measures—the stock market weighed more on the liquidity channel than the trade channel, while ex-post operating performance indicate that the latter played a more important role than the former in transmitting the crisis to Japanese firms.

Published: Hosono, Kaoru, Miho Takizawa, and Kotaro Tsuru, 2016. "International transmission of the 2007-2009 financial crisis: Evidence from Japan," The Japanese Economic Review, Vol. 67(3), pp. 295-328