Bank Regulation and Supervision in Bank-Dominated Financial Systems: A Comparison Between Japan and Germany

Posted: 2 Mar 2009

See all articles by Ralf Bebenroth

Ralf Bebenroth

Kobe University, RIEB-Center

Diemo Dietrich

Newcastle University Business School

Uwe Vollmer

University of Leipzig

Date Written: March 1, 2009

Abstract

This paper compares bank regulation and supervision in Japan and Germany. We consider these countries because they both have bank-dominated financial systems and their banking systems are often lumped together as one model, yet, bank stability differs significantly. We show that Japan and Germany have chosen different approaches to bank regulation and supervision and ask why they made their choices. We argue that bank regulation and supervision were less efficient in Japan than in Germany and that these differences were decisive for bank behavior.

Keywords: Japan and Germany, Bank regulation and supervision, Deposit insurance, Lender of last resort, Forbearance, Varieties of capitalism

JEL Classification: G21, G38, P52

Suggested Citation

Bebenroth, Ralf and Dietrich, Diemo and Vollmer, Uwe, Bank Regulation and Supervision in Bank-Dominated Financial Systems: A Comparison Between Japan and Germany (March 1, 2009). European Journal of Law and Economics, Vol. 27, No. 2, 2009, Available at SSRN: https://ssrn.com/abstract=1351422

Ralf Bebenroth

Kobe University, RIEB-Center ( email )

Rokkodai 2-1
RIEB-Center, Shinkan
Kobe, Hyogo ken 657-8501
Japan
0081-78-803-7021 (Phone)

HOME PAGE: http://www.bebenroth.eu

Diemo Dietrich (Contact Author)

Newcastle University Business School ( email )

5 Barrack Road
Newcastle-upon-Tyne NE1 7RU, NE1 4SE
United Kingdom

HOME PAGE: http://www.ncl.ac.uk/business-school/staff/profile/diemodietrich.html

Uwe Vollmer

University of Leipzig ( email )

Marschnerstrasse 31
D-04109 Leipzig, 04109
Germany

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