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The Evolution of Trust in Japan: The Case of Vertical Keiretsu Groups
Abstract
Research on corporate ownership in Japan focus mainly on corporate networks: horizontal and vertical keiretsu. Horizontal keiretsu are networks of firms whose small individual equity stakes in each other collectively sum to control blocks structured around a main bank. Vertical (manufacturing) keiretsu are similar structures that encompass the suppliers and customers of a single large firm. Vertical networks, representative of long-lasting and stable relationships (especially in the Japanese car industry), are undergoing drastic changes. Many authors insist there have been significant changes observed within keiretsu since the end of the 1990s. To have a better understanding of the evolution of trust within keiretsu, it is necessary to analyse its industrial organisation evolution. The authors first situate the Japanese organisational structure and then present a review of the main stages of the change that has affected vertical keiretsu, together with the factors that have contributed to this change. Finally, they analyse the evolution of trust within keiretsu. The authors illustrate the evolution of keiretsu via a case study: the Nissan keiretsu closely related to the Renault-Nissan alliance.
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