Are Corporate Financing Decisions Different in Japan? An Empirical Study on Capital Structure

Shin'Ichi Hirota*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

29 Citations (Scopus)


This paper investigates empirically how Japanese firms determine capital structure. I show that a firm's capital structure in Japan can be explained, to some extent, by real factors derived from theories of the capital structure. I also find remarkable results showing that the capital structure of Japanese firms is substantially affected by the institutional and regulatory characteristics of Japanese capital markets. Therefore, I conclude that both real and institutional factors are important determinants of corporate financing decisions in Japan. This result indicates that it is necessary to consider both theories and institutional features in each country to fully understand a firm's capital structure choice. J. Japan. Int. Econ., September 1999, 13(3), pp. 201-229. School of Commerce, Waseda University, 1-6-1, Nishiwaseda, Shinjuku-ku, Tokyo, 169-8050, Japan. Copyright 1999 Academic Press. Journal of Economic Literature Classification Numbers: G15, G32, G38.

Original languageEnglish
Pages (from-to)201-229
Number of pages29
JournalJournal of The Japanese and International Economies
Issue number3
Publication statusPublished - 1999 Sept

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics
  • Political Science and International Relations


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