The performance implications of relationship banking during macroeconomic expansion and contraction: a study of Japanese banks' social relationships and overseas expansion

Publication Type

Journal Article

Publication Date

4-2008

Abstract

We propose a social perspective emphasizing the opportunities and constraints of bank-firm relationships to understand the determinants of relationship banks' performance, using Japanese banks to test our theory. Using social exchange and role theories, we found banks that have strong social relationships performed differently during Japan's macroeconomic expansion and contraction cycles. However, our results indicate that social exchange and role relationships are context-specific: banks benefited from internationalization during a domestic macroeconomic expansion as a result of their home-country social relationships, but they were less constrained by the same social relationships in their international operations during a domestic macroeconomic contraction.

Keywords

relationship banking, comparative corporate governance, social exchange and role, business groups, Japan, keiretsu

Discipline

Asian Studies | Business and Corporate Communications | International Business

Research Areas

Strategy and Organisation

Publication

Journal of International Business Studies

Volume

39

Issue

3

First Page

406

Last Page

427

ISSN

0047-2506

Identifier

10.1057/palgrave.jibs.8400364

Publisher

Palgrave Macmillan

Additional URL

https://doi.org/10.1057/palgrave.jibs.8400364

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