The Effects of Endogenous Interdependencies on Trade Network Formation across Space among Major Japanese Firms

Author Name Petr MATOUS (University of Tokyo) / TODO Yasuyuki (Faculty Fellow, RIETI)
Creation Date/NO. April 2014 14-E-020
Research Project Empirical Analysis on Determinants and Impacts of the Formation of Firm Networks
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The network structures of interfirm interactions have been linked previously to disaster resilience. However, the dynamic drivers of interfirm network structures rarely have been explored in the literature. This paper uses stochastic actor-oriented modeling to examine how networks of economic interactions among the 500 largest Japanese companies were created and maintained between 2010 and 2011, i.e., before and after the Great East Japan Earthquake. Controlling for geographical distance between firms' headquarters and for firm size, we find that firms preferred trading partners that generally were popular among other firms, had clients in common with them, and also had bought some products or services from them, and that firms avoided firms with connections to independent suppliers in other cliques. These tendencies have potential implications for disaster resilience and the revival of the Japanese economy.

Published: Petr Matous and Yasuyuki Todo, 2016. "Energy and resilience: The effects of endogenous interdependencies on trade network formation across space among major Japanese firms," Network Science, Vol. 4(2), pp.141-163