Abstract

http://ssrn.com/abstract=1958169
 
 

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Is Japan Really a 'Buy'? The Corporate Governance, Cash Holdings, and Economic Performance of Japanese Companies


Kazuo Kato


Osaka University of Economics

Meng Li


Naveen Jindal School of Management, The University of Texas at Dallas

Douglas J. Skinner


The University of Chicago - Booth School of Business

February 1, 2013

Chicago Booth Research Paper No. 13-06

Abstract:     
We test whether reforms in Japanese corporate governance have been effective. Specifically, we investigate whether Japanese firms improve their management of cash and whether such changes translate into improved performance. Consistent with improved governance for some Japanese firms since the late 1990s, we find that, on average, the (excess) cash holdings of Japanese firms decline; that cash holdings are now more sensitive to their hypothesized economic determinants; and that there is a strong overall increase in dividends and repurchases. These changes relate to improvements in performance and changes in ownership characteristics in ways consistent with an overall improvement in governance.

Number of Pages in PDF File: 57

Keywords: Japan, corporate governance, payout policy, dividends

JEL Classification: G15, G34, G35

working papers series


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Date posted: November 12, 2011 ; Last revised: February 18, 2013

Suggested Citation

Kato, Kazuo and Li, Meng and Skinner, Douglas J., Is Japan Really a 'Buy'? The Corporate Governance, Cash Holdings, and Economic Performance of Japanese Companies (February 1, 2013). Chicago Booth Research Paper No. 13-06. Available at SSRN: http://ssrn.com/abstract=1958169 or http://dx.doi.org/10.2139/ssrn.1958169

Contact Information

Kazuo Kato
Osaka University of Economics ( email )
2-2-8 Osumi
Higashiyokogawa-ku
Osaka
Japan
Meng Li
Naveen Jindal School of Management, The University of Texas at Dallas ( email )
800 W Campbell Road
Richardson, TX 75080
United States
(972)883-2492 (Phone)
Douglas J. Skinner (Contact Author)
The University of Chicago - Booth School of Business ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-7137 (Phone)

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