Ranald C. Michie
- Published in print:
- 2006
- Published Online:
- September 2007
- ISBN:
- 9780199280612
- eISBN:
- 9780191712784
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199280612.003.0007
- Subject:
- Economics and Finance, Economic History
This chapter discusses developments in the global securities market between the two world wars. Topics covered include the securities markets during the First World War, the impact of the First World ...
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This chapter discusses developments in the global securities market between the two world wars. Topics covered include the securities markets during the First World War, the impact of the First World War on global securities markets, the 1920s, the Wall Street Crash, and securities markets and national governments during the 1930s.Less
This chapter discusses developments in the global securities market between the two world wars. Topics covered include the securities markets during the First World War, the impact of the First World War on global securities markets, the 1920s, the Wall Street Crash, and securities markets and national governments during the 1930s.
Ranald C. Michie
- Published in print:
- 2006
- Published Online:
- September 2007
- ISBN:
- 9780199280612
- eISBN:
- 9780191712784
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199280612.003.0010
- Subject:
- Economics and Finance, Economic History
This chapter discusses developments in the global securities markets in the late 20th century. It is shown that the securities markets once again became essential components of each national ...
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This chapter discusses developments in the global securities markets in the late 20th century. It is shown that the securities markets once again became essential components of each national financial system and provided a key element in the financial flows that redistributed savings around the world, bringing stability to the international monetary system. By 2005, a new global securities market was in full operation, which involved a degree of integration and interaction never before seen. This was the result of a culmination of technological and organizational advances during the 20th century. The securities markets had also overcome the governmental and institutional barriers that had previously restricted its development.Less
This chapter discusses developments in the global securities markets in the late 20th century. It is shown that the securities markets once again became essential components of each national financial system and provided a key element in the financial flows that redistributed savings around the world, bringing stability to the international monetary system. By 2005, a new global securities market was in full operation, which involved a degree of integration and interaction never before seen. This was the result of a culmination of technological and organizational advances during the 20th century. The securities markets had also overcome the governmental and institutional barriers that had previously restricted its development.
Ranald C. Michie
- Published in print:
- 2001
- Published Online:
- November 2003
- ISBN:
- 9780199242559
- eISBN:
- 9780191596643
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199242550.003.0014
- Subject:
- Economics and Finance, Economic History, Financial Economics
The Big Bang described in the last chapter appeared to have answered the doubts over the future of the London Stock Exchange, but from the late 1980s onwards into the 1990s, it both waned in ...
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The Big Bang described in the last chapter appeared to have answered the doubts over the future of the London Stock Exchange, but from the late 1980s onwards into the 1990s, it both waned in importance within the British financial system and faced increasing competition from rival foreign stock exchanges. This chapter discusses the reasons for this, starting in the first section with relations with government, since one uncertainty was the level of freedom from government control that the Stock Exchange was to enjoy. With the disappearance of the Stock Exchange's quasi‐official status in the 1990s, there still remained doubts over the role that it had to play in the area of securities market supervision, and the next section of the chapter discusses this situation, the effect of the changing nature of its membership, the disaster over settlement services (the replacement of the successful TALISMAN (Transfer Accounting and Lodgement for Investors, Stock Management for Jobbers) by TAURUS (Transfer and Automated Registration of Uncertificated Stock) and the subsequent failure of TAURUS), and the eventual successful replacement of the SEAQ (Stock Exchange Automated Quotations) trading system by the SEQUENCE trading system from 1993 onwards. The third section of the chapter looks at the provision of the market, and the fact that with the proposed introduction of specialists or sole traders in 1992, the Stock Exchange had once again been brought to the attention of the Office of Fair Trading; competition was also forcing a re‐examination of the way the Stock Exchange's market was organized, and this resulted in the introduction in 1997 of order‐driven trading in the form of SETS (Stock Exchange Trading Service); this section also looks at the abandonment of the traded options market to LIFFE (London International Financials Futures Exchange) and of any pretensions to the futures market, the decline of the USM (Unlisted Securities Market) and its replacement by AIM (Alternative Investment Market), negotiations with various foreign stock markets, and the changing investment environment. The last part of the chapter looks specifically at the changing membership of the Stock Exchange.Less
The Big Bang described in the last chapter appeared to have answered the doubts over the future of the London Stock Exchange, but from the late 1980s onwards into the 1990s, it both waned in importance within the British financial system and faced increasing competition from rival foreign stock exchanges. This chapter discusses the reasons for this, starting in the first section with relations with government, since one uncertainty was the level of freedom from government control that the Stock Exchange was to enjoy. With the disappearance of the Stock Exchange's quasi‐official status in the 1990s, there still remained doubts over the role that it had to play in the area of securities market supervision, and the next section of the chapter discusses this situation, the effect of the changing nature of its membership, the disaster over settlement services (the replacement of the successful TALISMAN (Transfer Accounting and Lodgement for Investors, Stock Management for Jobbers) by TAURUS (Transfer and Automated Registration of Uncertificated Stock) and the subsequent failure of TAURUS), and the eventual successful replacement of the SEAQ (Stock Exchange Automated Quotations) trading system by the SEQUENCE trading system from 1993 onwards. The third section of the chapter looks at the provision of the market, and the fact that with the proposed introduction of specialists or sole traders in 1992, the Stock Exchange had once again been brought to the attention of the Office of Fair Trading; competition was also forcing a re‐examination of the way the Stock Exchange's market was organized, and this resulted in the introduction in 1997 of order‐driven trading in the form of SETS (Stock Exchange Trading Service); this section also looks at the abandonment of the traded options market to LIFFE (London International Financials Futures Exchange) and of any pretensions to the futures market, the decline of the USM (Unlisted Securities Market) and its replacement by AIM (Alternative Investment Market), negotiations with various foreign stock markets, and the changing investment environment. The last part of the chapter looks specifically at the changing membership of the Stock Exchange.
Elliot Posner
- Published in print:
- 2005
- Published Online:
- February 2006
- ISBN:
- 9780199283958
- eISBN:
- 9780191603297
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199283958.003.0009
- Subject:
- Political Science, European Union
Small capitalization markets like the US Nasdaq have proliferated in Europe in recent years as part of a broad but uneven process of financial reforms. Though often seen as a fairly direct response ...
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Small capitalization markets like the US Nasdaq have proliferated in Europe in recent years as part of a broad but uneven process of financial reforms. Though often seen as a fairly direct response to financial globalization and market forces, they are, in fact, the product of supranational entrepreneurship and intra-European national rivalries. Nationally-based stock markets suddenly created small-cap markets not because of widely-perceived market pressures, but in response to moves by the European Commission that threatened to replace national markets with European ones.Less
Small capitalization markets like the US Nasdaq have proliferated in Europe in recent years as part of a broad but uneven process of financial reforms. Though often seen as a fairly direct response to financial globalization and market forces, they are, in fact, the product of supranational entrepreneurship and intra-European national rivalries. Nationally-based stock markets suddenly created small-cap markets not because of widely-perceived market pressures, but in response to moves by the European Commission that threatened to replace national markets with European ones.
Brigitte Madrian, Olivia S. Mitchell, and Beth J. Soldo
- Published in print:
- 2007
- Published Online:
- September 2007
- ISBN:
- 9780199230778
- eISBN:
- 9780191710971
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199230778.003.0012
- Subject:
- Business and Management, Pensions and Pension Management
This chapter evaluates the so-called “Swedish experiment” in 2000, the traditional Swedish pay-as-you-go retirement system was partially replaced by a national defined contribution plan. The question ...
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This chapter evaluates the so-called “Swedish experiment” in 2000, the traditional Swedish pay-as-you-go retirement system was partially replaced by a national defined contribution plan. The question addressed is whether participants perceived their investments in the new system as a substitute for direct investments, and whether allocating more equities in these pension accounts induced participants to change their directly-held equity investments. Results show that investors did not perceive direct investment in the equity market as a close substitute for their retirement accounts, suggesting that an individual account system will not crowd out direct equity market investment. Accordingly, the new Swedish system may actually help educate investors about the benefits of stock market participation, increasing participation and thus indirectly boosting saving.Less
This chapter evaluates the so-called “Swedish experiment” in 2000, the traditional Swedish pay-as-you-go retirement system was partially replaced by a national defined contribution plan. The question addressed is whether participants perceived their investments in the new system as a substitute for direct investments, and whether allocating more equities in these pension accounts induced participants to change their directly-held equity investments. Results show that investors did not perceive direct investment in the equity market as a close substitute for their retirement accounts, suggesting that an individual account system will not crowd out direct equity market investment. Accordingly, the new Swedish system may actually help educate investors about the benefits of stock market participation, increasing participation and thus indirectly boosting saving.
Roy C. Smith and Ingo Walter
- Published in print:
- 2006
- Published Online:
- September 2006
- ISBN:
- 9780195171679
- eISBN:
- 9780199783618
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195171675.003.0001
- Subject:
- Economics and Finance, Microeconomics
This chapter examines the nature, effects, and consequences of the bubble of 1995-2000. The 20th century experienced four exceptional stock market booms in the United States that have been called ...
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This chapter examines the nature, effects, and consequences of the bubble of 1995-2000. The 20th century experienced four exceptional stock market booms in the United States that have been called “bubbles”. Economist Richard Sylla describes these periods (1905, 1928, 1958, 1998) as times when the 10-year moving averages of real rates of return on stocks reached peaks from which they rapidly descended (or crashed) a year to two later. Of these four bubbles, the ones that peaked in 1928 and 1998, leading to crashes in 1929 and 2000, respectively, were the ones of greatest significance. The 2000 crash involved more financial wreckage than earlier crashes. It was followed by scandals that were front-page stories for months, and public interest in the market collapse and its causes and consequences was intense. The causes of the 2000-2002 crash are analyzed.Less
This chapter examines the nature, effects, and consequences of the bubble of 1995-2000. The 20th century experienced four exceptional stock market booms in the United States that have been called “bubbles”. Economist Richard Sylla describes these periods (1905, 1928, 1958, 1998) as times when the 10-year moving averages of real rates of return on stocks reached peaks from which they rapidly descended (or crashed) a year to two later. Of these four bubbles, the ones that peaked in 1928 and 1998, leading to crashes in 1929 and 2000, respectively, were the ones of greatest significance. The 2000 crash involved more financial wreckage than earlier crashes. It was followed by scandals that were front-page stories for months, and public interest in the market collapse and its causes and consequences was intense. The causes of the 2000-2002 crash are analyzed.
Brigitte Madrian, Olivia S. Mitchell, and Beth J. Soldo
- Published in print:
- 2007
- Published Online:
- September 2007
- ISBN:
- 9780199230778
- eISBN:
- 9780191710971
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199230778.003.0009
- Subject:
- Business and Management, Pensions and Pension Management
This chapter documents the investment choices of workers outside their company pensions. The Health and Retirement Study is used to evaluate how investment patterns outside pension holdings have been ...
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This chapter documents the investment choices of workers outside their company pensions. The Health and Retirement Study is used to evaluate how investment patterns outside pension holdings have been influenced by the shift from defined benefit to defined contribution pensions. Since workers with defined benefit plans can expect steady income in retirement, they might be thought to invest less conservatively outside their pensions. Nevertheless, the data show otherwise. Defined contribution participants also hold stock investments outside their pension portfolios. These findings suggest that increased stock holding as defined benefit plans decline in importance.Less
This chapter documents the investment choices of workers outside their company pensions. The Health and Retirement Study is used to evaluate how investment patterns outside pension holdings have been influenced by the shift from defined benefit to defined contribution pensions. Since workers with defined benefit plans can expect steady income in retirement, they might be thought to invest less conservatively outside their pensions. Nevertheless, the data show otherwise. Defined contribution participants also hold stock investments outside their pension portfolios. These findings suggest that increased stock holding as defined benefit plans decline in importance.
Kathryn C. Lavelle
- Published in print:
- 2004
- Published Online:
- April 2005
- ISBN:
- 9780195174090
- eISBN:
- 9780199835287
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195174097.003.0001
- Subject:
- Economics and Finance, Development, Growth, and Environmental
This chapter sets forth an explanation for international convergence in state behavior in creating and promoting emerging stock markets. Focusing on the commanding heights of privatized industry, it ...
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This chapter sets forth an explanation for international convergence in state behavior in creating and promoting emerging stock markets. Focusing on the commanding heights of privatized industry, it uses the metaphor of a two-level game from international relations theory to argue that when political leaders privatize large enterprise, they must negotiate with individuals outside the state to seek outcomes that are acceptable to structural international necessity, and they must negotiate with domestic constituencies to seek outcomes that are politically acceptable at home. To do so, policymakers create the specific financial instruments, with specific ownership and control characteristics. Since the new offerings joined whatever shares may or may not have already been listed on a given exchange, the resulting financial institutional structures fail to converge on one “model” of corporate governance or another, as Western financial institutions have converged over time. This theoretical premise would thus predict a large number of new exchanges appearing, at least in name, yet having vastly different volumes and types of listings, relative to the size of the local economy.Less
This chapter sets forth an explanation for international convergence in state behavior in creating and promoting emerging stock markets. Focusing on the commanding heights of privatized industry, it uses the metaphor of a two-level game from international relations theory to argue that when political leaders privatize large enterprise, they must negotiate with individuals outside the state to seek outcomes that are acceptable to structural international necessity, and they must negotiate with domestic constituencies to seek outcomes that are politically acceptable at home. To do so, policymakers create the specific financial instruments, with specific ownership and control characteristics. Since the new offerings joined whatever shares may or may not have already been listed on a given exchange, the resulting financial institutional structures fail to converge on one “model” of corporate governance or another, as Western financial institutions have converged over time. This theoretical premise would thus predict a large number of new exchanges appearing, at least in name, yet having vastly different volumes and types of listings, relative to the size of the local economy.
Steen Thomsen
- Published in print:
- 2004
- Published Online:
- September 2007
- ISBN:
- 9780199269761
- eISBN:
- 9780191710087
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199269761.003.0014
- Subject:
- Business and Management, Corporate Governance and Accountability
This chapter focuses on change, rather than static differences/similarities among countries. The study shows that large differences between US-UK and Europe persist, together with some convergence ...
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This chapter focuses on change, rather than static differences/similarities among countries. The study shows that large differences between US-UK and Europe persist, together with some convergence trends in the late 1990s (on both sides) as far as ownership concentration is concerned. The chapter observes that convergence on this aspect co-exists with divergence (or persisting differences) on other aspects; that convergence among the two areas has been toward each other and not from one to the other (in particular not only of Europe towards the US), and that these dynamics are in any case likely to have been specific to the stock market bubble period and should not be extrapolated.Less
This chapter focuses on change, rather than static differences/similarities among countries. The study shows that large differences between US-UK and Europe persist, together with some convergence trends in the late 1990s (on both sides) as far as ownership concentration is concerned. The chapter observes that convergence on this aspect co-exists with divergence (or persisting differences) on other aspects; that convergence among the two areas has been toward each other and not from one to the other (in particular not only of Europe towards the US), and that these dynamics are in any case likely to have been specific to the stock market bubble period and should not be extrapolated.
Roy C. Smith, Ingo Walter, and Gayle Delong
- Published in print:
- 2012
- Published Online:
- May 2012
- ISBN:
- 9780195335934
- eISBN:
- 9780199932146
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195335934.003.0005
- Subject:
- Economics and Finance, Economic Systems
This chapter discusses the extraordinary growth in international stocks. Issuers tap international stock markets to increase the pool of available funds, lower costs of raising capital, expand their ...
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This chapter discusses the extraordinary growth in international stocks. Issuers tap international stock markets to increase the pool of available funds, lower costs of raising capital, expand their investor base, and/or avoid domestic regulatory complications. Investors move to international markets to improve portfolio performance and to lower risks. Both groups' interests have been furthered by the erosion of regulatory barriers, including exchange controls, limits on ownership, limits on participation in domestic markets, and obstructive listing and trading practices. Capital market integration is leading to a single world equity market. Investment houses stand prepared to make markets twenty-four hours a day in selected stocks. The infrastructure for such activity is being consolidated, sharpened, and challenged by new opportunities and competitive pressures.Less
This chapter discusses the extraordinary growth in international stocks. Issuers tap international stock markets to increase the pool of available funds, lower costs of raising capital, expand their investor base, and/or avoid domestic regulatory complications. Investors move to international markets to improve portfolio performance and to lower risks. Both groups' interests have been furthered by the erosion of regulatory barriers, including exchange controls, limits on ownership, limits on participation in domestic markets, and obstructive listing and trading practices. Capital market integration is leading to a single world equity market. Investment houses stand prepared to make markets twenty-four hours a day in selected stocks. The infrastructure for such activity is being consolidated, sharpened, and challenged by new opportunities and competitive pressures.
Charles R. Geisst
- Published in print:
- 1999
- Published Online:
- November 2003
- ISBN:
- 9780195130867
- eISBN:
- 9780199871155
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195130863.003.0007
- Subject:
- Economics and Finance, Economic History, Financial Economics
The boom and stock market crash of the 1920s. The public begins to invest in the stock market. Wall Street expands and banks begin selling securities. Wall Street bankers and brokers become ...
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The boom and stock market crash of the 1920s. The public begins to invest in the stock market. Wall Street expands and banks begin selling securities. Wall Street bankers and brokers become celebrities. Federal Reserve is unable to slow down market bubble. The crash occurs and country quickly slides into depression. Market loss the largest in American history.Less
The boom and stock market crash of the 1920s. The public begins to invest in the stock market. Wall Street expands and banks begin selling securities. Wall Street bankers and brokers become celebrities. Federal Reserve is unable to slow down market bubble. The crash occurs and country quickly slides into depression. Market loss the largest in American history.
Phillippe Aghion and Abhijit Banerjee
- Published in print:
- 2005
- Published Online:
- January 2007
- ISBN:
- 9780199248612
- eISBN:
- 9780191714719
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199248612.003.0008
- Subject:
- Economics and Finance, Development, Growth, and Environmental
This chapter begins with a synthesis of the topics covered in the preceding chapters. It argues that in order to explain the recent boom and bust episode in the United States, one should turn ...
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This chapter begins with a synthesis of the topics covered in the preceding chapters. It argues that in order to explain the recent boom and bust episode in the United States, one should turn attention to models of the stock market. It sketches an approach to booms and crashes that gives a central role to technical progress and the expansion of new markets.Less
This chapter begins with a synthesis of the topics covered in the preceding chapters. It argues that in order to explain the recent boom and bust episode in the United States, one should turn attention to models of the stock market. It sketches an approach to booms and crashes that gives a central role to technical progress and the expansion of new markets.
Kathryn C. Lavelle
- Published in print:
- 2004
- Published Online:
- April 2005
- ISBN:
- 9780195174090
- eISBN:
- 9780199835287
- Item type:
- book
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195174097.001.0001
- Subject:
- Economics and Finance, Development, Growth, and Environmental
When evaluating emerging stock markets, analysts usually fit them into a model of corporate governance derived from Western industrial experience, one where shares are dispersed and shareholders ...
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When evaluating emerging stock markets, analysts usually fit them into a model of corporate governance derived from Western industrial experience, one where shares are dispersed and shareholders influence firm management through the price mechanism, or one where shares are held in blocs and banks play a role. This book challenges this approach and the underlying assumptions, which are focused on economies at relatively high levels of development. It argues that the political dimension inherent in developing countries prevents the institutional formation of a price mechanism in corporate governance along Western lines. For these markets, stock is a political as well as an economic instrument that has negotiated the transitions associated with building and dismantling the state sector since the 19th century. The book begins with a historical overview of stock markets in developing countries and the international political circumstances that at times facilitated and at times hampered their growth. By focusing on the multiple possible connections between the ownership of shares of an individual firm and the control of rights attached to them, it details how those who wish to issue stock in emerging markets must comply simultaneously with the changing requirements of external actors and internal political constituencies. It then presents case studies of share issues from Latin America, Asia, Eastern Europe, and Africa, which build from the level of the firm, to the state, to the international system across the same time span. The book concludes with reflections on the role of equity finance in broader processes of privatization, development, and economic globalization.Less
When evaluating emerging stock markets, analysts usually fit them into a model of corporate governance derived from Western industrial experience, one where shares are dispersed and shareholders influence firm management through the price mechanism, or one where shares are held in blocs and banks play a role. This book challenges this approach and the underlying assumptions, which are focused on economies at relatively high levels of development. It argues that the political dimension inherent in developing countries prevents the institutional formation of a price mechanism in corporate governance along Western lines. For these markets, stock is a political as well as an economic instrument that has negotiated the transitions associated with building and dismantling the state sector since the 19th century. The book begins with a historical overview of stock markets in developing countries and the international political circumstances that at times facilitated and at times hampered their growth. By focusing on the multiple possible connections between the ownership of shares of an individual firm and the control of rights attached to them, it details how those who wish to issue stock in emerging markets must comply simultaneously with the changing requirements of external actors and internal political constituencies. It then presents case studies of share issues from Latin America, Asia, Eastern Europe, and Africa, which build from the level of the firm, to the state, to the international system across the same time span. The book concludes with reflections on the role of equity finance in broader processes of privatization, development, and economic globalization.
William Leon Megginson
- Published in print:
- 2005
- Published Online:
- October 2005
- ISBN:
- 9780195150629
- eISBN:
- 9780199835768
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195150627.003.0007
- Subject:
- Economics and Finance, Financial Economics
This chapter examines the impact of share issue privatizations (SIPs) on the growth of world capital markets, especially stock markets. It also studies privatization’s impact on the pattern of share ...
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This chapter examines the impact of share issue privatizations (SIPs) on the growth of world capital markets, especially stock markets. It also studies privatization’s impact on the pattern of share ownership by individuals and institutional investors. It begins by documenting the increasing importance of capital markets and the declining role of commercial banks in corporate financial systems around the world. It shows that privatization programs, particularly those involving public share offerings, have had a dramatic impact both on the development of non-US stock markets and the participation of individual and institutional investors in those markets. The components of a nation’s corporate governance system are described, and how privatization programs can promote the development of an effective corporate governance system is discussed.Less
This chapter examines the impact of share issue privatizations (SIPs) on the growth of world capital markets, especially stock markets. It also studies privatization’s impact on the pattern of share ownership by individuals and institutional investors. It begins by documenting the increasing importance of capital markets and the declining role of commercial banks in corporate financial systems around the world. It shows that privatization programs, particularly those involving public share offerings, have had a dramatic impact both on the development of non-US stock markets and the participation of individual and institutional investors in those markets. The components of a nation’s corporate governance system are described, and how privatization programs can promote the development of an effective corporate governance system is discussed.
Hideaki Miyajima and Fumiaki Kuroki
- Published in print:
- 2007
- Published Online:
- September 2007
- ISBN:
- 9780199284511
- eISBN:
- 9780191713705
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199284511.003.0003
- Subject:
- Economics and Finance, South and East Asia
As the ownership structure of Japanese corporations has changed dramatically during the 1990s, this chapter examines the causes and consequences of the decline in cross-shareholding. Using detailed ...
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As the ownership structure of Japanese corporations has changed dramatically during the 1990s, this chapter examines the causes and consequences of the decline in cross-shareholding. Using detailed and comprehensive data on ownership structure, including data on individual cross-shareholding relationships and other variables (Tobin's q) developed by the Nissai Life Insurance Research Institute and Waseda University, the chapter highlights the determinants of the choice between holding or selling shares for both banks and firms. Profitable firms with easy access to capital markets and a high level of foreign ownership prior to the banking crisis tended to unwind cross-shareholdings, while low-profit firms which had difficulty accessing capital markets and low foreign ownership tended to keep cross-shareholding with banks. High institutional shareholding and, surprisingly, block shareholding have had positive effects on firms' performance, while bank ownership has had consistently negative effects on firm performance. The result has been a growing diversity of ownership patterns among Japanese firms.Less
As the ownership structure of Japanese corporations has changed dramatically during the 1990s, this chapter examines the causes and consequences of the decline in cross-shareholding. Using detailed and comprehensive data on ownership structure, including data on individual cross-shareholding relationships and other variables (Tobin's q) developed by the Nissai Life Insurance Research Institute and Waseda University, the chapter highlights the determinants of the choice between holding or selling shares for both banks and firms. Profitable firms with easy access to capital markets and a high level of foreign ownership prior to the banking crisis tended to unwind cross-shareholdings, while low-profit firms which had difficulty accessing capital markets and low foreign ownership tended to keep cross-shareholding with banks. High institutional shareholding and, surprisingly, block shareholding have had positive effects on firms' performance, while bank ownership has had consistently negative effects on firm performance. The result has been a growing diversity of ownership patterns among Japanese firms.
Dariusz Wójcik
- Published in print:
- 2011
- Published Online:
- September 2011
- ISBN:
- 9780199592180
- eISBN:
- 9780191729089
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199592180.003.0008
- Subject:
- Business and Management, Finance, Accounting, and Banking
Chapter 8 summarizes the argument of the book, proposing a theory of stock market centres, understood as concentrations of stock market intermediaries, investors, and issuers' headquarters, operating ...
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Chapter 8 summarizes the argument of the book, proposing a theory of stock market centres, understood as concentrations of stock market intermediaries, investors, and issuers' headquarters, operating through a global network. The theory is supported with evidence presented in Chapters 1–7, as well as new empirical evidence on the size and evolution of stock market centres in the six largest economies of the world: the United States, China, Japan, Germany, France, and the United Kingdom. In this way, the book completes the journey from the map of stock markets focused on countries to a more complex, but also truer map on which cities play a key part. The chapter finishes with speculations about the implications of the theory of stock market centres, as well as other theoretical and empirical findings of the book, for the future of the global stock market and cities.Less
Chapter 8 summarizes the argument of the book, proposing a theory of stock market centres, understood as concentrations of stock market intermediaries, investors, and issuers' headquarters, operating through a global network. The theory is supported with evidence presented in Chapters 1–7, as well as new empirical evidence on the size and evolution of stock market centres in the six largest economies of the world: the United States, China, Japan, Germany, France, and the United Kingdom. In this way, the book completes the journey from the map of stock markets focused on countries to a more complex, but also truer map on which cities play a key part. The chapter finishes with speculations about the implications of the theory of stock market centres, as well as other theoretical and empirical findings of the book, for the future of the global stock market and cities.
Antoin E. Murphy
- Published in print:
- 1989
- Published Online:
- November 2003
- ISBN:
- 9780198286820
- eISBN:
- 9780191596681
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198286821.003.0009
- Subject:
- Economics and Finance, History of Economic Thought
Describes the Great Crashes in these cities in 1720. The great financial crashes of the Mississippi Company in Paris and the South Sea in London during 1720 and the way in which Cantillon increased ...
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Describes the Great Crashes in these cities in 1720. The great financial crashes of the Mississippi Company in Paris and the South Sea in London during 1720 and the way in which Cantillon increased his fortune through his speculations are outlined. John Law attempted to invite Cantillon back to France to assist him in his attempt to sustain the Mississippi System.Less
Describes the Great Crashes in these cities in 1720. The great financial crashes of the Mississippi Company in Paris and the South Sea in London during 1720 and the way in which Cantillon increased his fortune through his speculations are outlined. John Law attempted to invite Cantillon back to France to assist him in his attempt to sustain the Mississippi System.
Michael Lobban
- Published in print:
- 2010
- Published Online:
- May 2010
- ISBN:
- 9780199258826
- eISBN:
- 9780191705168
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199258826.003.0015
- Subject:
- Law, Legal History
This chapter on joint stock companies in the 19th century discusses companies and partnerships in the 1820s, reform of company law from 1830-48, transformation of company law from 1848-62, companies ...
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This chapter on joint stock companies in the 19th century discusses companies and partnerships in the 1820s, reform of company law from 1830-48, transformation of company law from 1848-62, companies and the stock market, the birth of companies, company management and the courts, the private company, and cartels.Less
This chapter on joint stock companies in the 19th century discusses companies and partnerships in the 1820s, reform of company law from 1830-48, transformation of company law from 1848-62, companies and the stock market, the birth of companies, company management and the courts, the private company, and cartels.
Masahiko Aoki
- Published in print:
- 2007
- Published Online:
- September 2007
- ISBN:
- 9780199284511
- eISBN:
- 9780191713705
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199284511.003.0015
- Subject:
- Economics and Finance, South and East Asia
This chapter examines the cumulative effects of gradual changes taking place in Japan's corporate landscape in general, and corporate governance in particular, in the past decade or so. It regards ...
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This chapter examines the cumulative effects of gradual changes taking place in Japan's corporate landscape in general, and corporate governance in particular, in the past decade or so. It regards corporate governance as an instance of institutional change which has not been completed yet. In order to substantiate this view, the chapter first documents the essential features of the changes and then interprets them using a game-theoretic framework of comparative corporate governance analysis. It identifies corporate governance institutions as multiple equilibria of a game played between investors, managers, and employees, and interprets the changes taking place in Japan as a transition from the model of Contingent Governance to that of stock market monitoring of complementary linkages between the managerial model and the specific human assets of the firm.Less
This chapter examines the cumulative effects of gradual changes taking place in Japan's corporate landscape in general, and corporate governance in particular, in the past decade or so. It regards corporate governance as an instance of institutional change which has not been completed yet. In order to substantiate this view, the chapter first documents the essential features of the changes and then interprets them using a game-theoretic framework of comparative corporate governance analysis. It identifies corporate governance institutions as multiple equilibria of a game played between investors, managers, and employees, and interprets the changes taking place in Japan as a transition from the model of Contingent Governance to that of stock market monitoring of complementary linkages between the managerial model and the specific human assets of the firm.
ANDREW GLYN
- Published in print:
- 2007
- Published Online:
- September 2007
- ISBN:
- 9780199226795
- eISBN:
- 9780191710544
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199226795.003.0003
- Subject:
- Economics and Finance, Economic Systems
This chapter traces shifts in the financial landscape over the past twenty-five years. These include the rise of the financial sector, the consumer credit boom that resulted in a rise in household ...
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This chapter traces shifts in the financial landscape over the past twenty-five years. These include the rise of the financial sector, the consumer credit boom that resulted in a rise in household consumption, the concentration of shareholdings in the hands of financial institutions, the rise of corporate governance, the costs and benefits of the great drive for shareholder value and the US stock market boom, the growth of international finance, and the eventual financial crises.Less
This chapter traces shifts in the financial landscape over the past twenty-five years. These include the rise of the financial sector, the consumer credit boom that resulted in a rise in household consumption, the concentration of shareholdings in the hands of financial institutions, the rise of corporate governance, the costs and benefits of the great drive for shareholder value and the US stock market boom, the growth of international finance, and the eventual financial crises.
