Stable shareholdings and Japan's bubble economy: an historical overview

This is an exploratory study aimed at establishing the existence of a strategy utilized by large Japanese industrial groups to protect themselves against external threats. A measure is developed to assess the stability of the top 10 shareholders of 134 leading companies in the six Japanese industrial groups—Mitsui, Mitsubishi, Sumitomo, DKB, Sanwa, and Fuyo—over the 1973–93 period. The results demonstrate the use by these companies of their networks of stable shareholdings as a strategic response to deal with threats to group company governance structures arising from the stock market and property boom of the late 1980s (known in Japan as the ‘bubble’ economy) and its aftermath. Some theoretical and practical reflections are presented. © 1998 John Wiley & Sons, Ltd.