Corporate Restructuring in Japan: An Event-Study Analysis

15 Pages Posted: 13 Aug 2002  

Jorge A. Chan-Lau

International Monetary Fund (IMF) - International Capital Markets Department; National University of Singapore (NUS) - Risk Management Institute; Tufts University - Fletcher School of Law and Diplomacy

Multiple version iconThere are 2 versions of this paper

Date Written: December 2001

Abstract

The implementation of the Commercial Rehabilitation Law (CRL) on April 1, 2000, was considered a key event in setting up the official infrastructure supporting corporate restructuring in Japan. This study evaluates the stock price impact of restructuring announcements before and after the CRL implementation using event-study analysis. Following the CRL implementation, the results suggest an improvement in market credibility of restructuring announcements based on improvements in disclosure, mergers, and to a lesser extent, labor force reductions. In contrast, the credibility of restructuring announcements aimed at reducing excess capital deteriorated.

Keywords: Japan, corporate restructuring, corporate governance, event-study analysis

JEL Classification: G34

Suggested Citation

Chan-Lau, Jorge A., Corporate Restructuring in Japan: An Event-Study Analysis (December 2001). IMF Working Paper No. 1/202. Available at SSRN: https://ssrn.com/abstract=320080 or http://dx.doi.org/10.2139/ssrn.320080

Jorge Antonio Chan-Lau (Contact Author)

International Monetary Fund (IMF) - International Capital Markets Department ( email )

700 19th Street NW
Washington, DC 20431
United States

National University of Singapore (NUS) - Risk Management Institute ( email )

21 Heng Mui Keng Terrace
Level 4
Singapore, 119613
Singapore

Tufts University - Fletcher School of Law and Diplomacy ( email )

160 Packard Ave
Medford, MA 02155
United States

HOME PAGE: http://fletcher.tufts.edu/ceme/index.shtml

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