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The effects of the keiretsu on the export performance of Japanese companies: help or hindrance?
Author(s) -
Hundley Greg,
Jacobson Carol K.
Publication year - 1998
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/(sici)1097-0266(199810)19:10<927::aid-smj989>3.0.co;2-1
Subject(s) - keiretsu , business , industrial organization , argument (complex analysis) , export performance , competitive advantage , international trade , marketing , finance , biochemistry , chemistry
This study investigates the effect that membership in a financial keiretsu has on the export performance of Japanese manufacturing companies. Companies that belong to one of the six major financial keiretsu are found to have lower export ratios than similar companies who are not members. The negative effects of keiretsu membership appear confined to producer goods companies where intergroup linkages such as preferential trading relationships are tightest. Additional evidence from the producer goods sector showing that keiretsu members do less well on other measures of company performance supports the argument that the cartel‐like properties sometimes ascribed to the keiretsu actually reduce competitiveness, thus dampening export performance. In general, the data do not support recommendations that non‐Japanese companies might look to keiretsu‐type alliances as an organizational strategy that will lead to competitive advantage in global markets. © 1998 John Wiley & Sons, Ltd.