Lifetime employment, extensive subcontracting networks in the "Toyota Production System", cross-shareholdings, the main bank system, and an internal, bank-centered corporate governance system with limited mergers and acquisitions have long been the core features of Japan's industrial system. However, since the watershed financial crisis of 1997/98 all of these have begun to change. To fully understand Japan as the country recovers from its decade-long recession, we need to appreciate these ongoing changes and reevaluate our established wisdom on how Japanese companies operate.
Ulrike Schaede is an Associate Professor at the Graduate School of International Relations and Pacific Studies, University of California, San Diego. Her research interests include financial markets, the role of trade associations and antitrust policy in Japan, and the role of the government in Japan's regulatory system. Her recent publications include Cooperative Capitalism: Self-Regulation, Trade Associations and the Antimonopoly Law in Japan (Oxford University Press, 2000) and Managed Globalization: Adapting to the 21st Century (co-edited with William Grimes, M.E. Sharpe 2002).