ARIKAWA Yasuhiro (Faculty Fellow) /MIYAJIMA Hideaki (Faculty Fellow)
The purpose of this paper is to provide an overview of the relationship banking in Japan in the 1990s. We show the increasing dependence on bank borrowing in spite of the deregulation of bond market in the mid 1990s in terms of the debt composition, and we confirm the loan from main-bank also increases among the firms with higher bank borrowing. Then, we examine the effects of these facts on borrowing firm behavior. By estimating the employment adjustment function, we present that main bank did not discipline effectively firms that were required the corporate restructuring, while it encouraged the restructuring of the firm with relatively better performance.