Corporate Restructuring in Japan : An Event-Study Analysis

Author/Editor:

Jorge A Chan-Lau

Publication Date:

December 1, 2001

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

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, credibility of restructuring announcements aimed at reducing excess capital deteriorated.

Series:

Working Paper No. 01/202

Subject:

English

Publication Date:

December 1, 2001

ISBN/ISSN:

9781451874402/1018-5941

Stock No:

WPIEA2022001

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

15

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