Hirofumi Uchida

Hirofumi Uchida
Kobe University | Shindai · Graduate School of Business Administration

PhD

About

60
Publications
10,170
Reads
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1,529
Citations
Additional affiliations
April 2011 - present
Kobe University
Position
  • Professor
April 2009 - March 2011
Kobe University
Position
  • Professor (Associate)
April 2000 - March 2009
Wakayama University
Position
  • Professor (Associate)

Publications

Publications (60)
Article
We use unique data on Japanese SMEs to investigate how the bank-firm relationship affects the loan maturity of SMEs in Japan. We apply Diamond's (1991) model on the firms’ choice of long- versus short-term debt to the context of SME lending and test a prediction in a manner faithful to the applied model. We find that the ratio of long-term loans de...
Article
This study explores the use of initial funding sources using a unique sample of various types of start-up firms in Japan obtained from multiple surveys. We provide evidence on the differences in the use of initial funding sources and their determinants across start-up firms by estimating a multivariate probit model. Our findings indicate that found...
Article
This paper examines whether there is a difference in the value of voluntarily assured financial statements of private firms, depending on the availability of other information for the users of the statements. By using a within-firm estimator that completely controls for firm fixed effects, we find that the loan interest rate for private firms with...
Article
Using unique micro data compiled from the real estate registry in Japan, we examine more than 400,000 loan-to-value (LTV) business loan ratios to draw implications for caps on LTV ratios as a macroprudential policy measure. We find that the LTV ratio exhibits counter-cyclicality, behavior that would have severely impeded the efficacy of a simple LT...
Chapter
This chapter focuses on the structure, performance, and some of the defining characteristics of the Japanese banking industry. An analysis of the banking industry in Japan may be of particular interest because of its important role in one of world’s largest economies, its historical orientation to banks in its financial system, its idiosyncratic fe...
Article
This paper examines the effects of real and financial measures that firms adopt to respond to adverse shocks on trade credit that they owe. We find that a reduction in the quantity of purchases reduces trade credit, while lengthening the period of accounts payable increases it. However, the effect of the former is more economically significant than...
Article
This article investigates the effect of banks’ lending capacity on firms’ investment. To identify exogenous shocks to loan supply, we utilize the natural experiment provided by Japan's Great Hanshin-Awaji earthquake in 1995. Using a unique data set that allows us to identify firms and banks in the earthquake-affected areas, we find that the investm...
Article
In this paper, we investigate whether financial shocks to firms affect their probability of bankruptcy. We also examine whether these shocks affect the natural selection of the firms, whereby more efficient firms are less likely to go bankrupt. By using the data on the bankruptcy of firms after the Great Tohoku Earthquake, we examine the impact of...
Chapter
In this paper, we describe the current status of interfirm relationships in Japan with a special emphasis on the trade credit between firms. To do so, we first need to clarify what kind of firms in Japan we report on. In this section, we describe the source of our data, and how we chose the sample firms that are used for the analysis in the subsequ...
Chapter
Employing a unique micro dataset on the financial relationships between Japanese firms and their main banks and the use of collateral in their debt financing, this chapter provides a detailed account of the current landscape of business financing in Japan. The findings can be summarized as follows. First, main bank relationships are stable for most...
Article
We examine who is the repository of soft information within bank organizations. Inconsistent with the conventional view of loan officers as the sole repository, we find that branch managers have the most soft information. We also find the repository at a higher hierarchical level at smaller banks. Furthermore, our evidence suggests that branch mana...
Chapter
This chapter focuses on the Japanese banking industry. We examine its structure, its performance, and some of its defining characteristics. We first provide an overview of the Japanese banking system. Topics covered are the importance of banking and intermediated finance in the Japanese economy, segmentation in the Japanese banking market, market s...
Article
In this paper we propose a new test of the efficient structure (ES) hypothesis, which predicts that efficient firms come out ahead in competition and grow as a result. Our test has significant advantages over existing ones, because it is more direct, and can jointly test the so-called quiet-life hypothesis, which predicts that in a concentrated mar...
Article
Using a unique micro dataset compiled from official real estate registries in Japan, we examine the evolution of loan-to-value (LTV) ratios for business loans over the 1975 to 2009 period, the determinants of these ratios, and the ex post performance of the borrowers. We find that the LTV ratio exhibits counter-cyclicality, implying that the increa...
Article
In this paper, we investigate whether a natural selection mechanism works for firm exit. By using data of firms after a devastating earthquake, the Great Tohoku Earthquake, we examine the impact of firm efficiency on firm exit both inside and outside the earthquake-affected areas. We find evidence suggesting that more efficient firms are less likel...
Article
Full-text available
We ask three questions to clarify the production of soft information and decision making within a bank organization: (1) In a hierarchical ladder within a bank organization, who has more soft information on borrowers (repository of soft information) and does the answer differ depending on bank- and/or firm-specific factors?; (2) In the hierarchical...
Article
Full-text available
We study the impact of the Great Hanshin-Awaji Earthquake on firm dynamics and obtain implications for the recent Great East Japan Earthquake. By using unique micro-level data for a maximum of 90,000 firms, we examine the impact of the earthquake on firms' default, relocation, and investment activities to find the following. First, default probabil...
Article
This article examines the structure, performance, and some of the defining characteristics of the Japanese banking industry. It begins with an overview of the Japanese banking system. It then addresses specific topics related to the Japanese banking system: the main bank system (including relationship banking), the Japanese banking crisis during th...
Article
Full-text available
By applying factor analysis to unique data on loan screening for small and medium-sized enterprises (SMEs) in Japan, we investigate the factors that banks actually evaluate when underwriting commercial loans. We find that banks emphasize three factors when they decide whether to grant loans: the relationship factor, the financial statement factor,...
Article
This paper investigates whether Japanese banks followed herd behaviour during the 1980s and 1990s. The results indicate the existence of herding during the sample period, while the inefficiency of herding is concentrated in the early to mid 1980s, the period immediately after financial deregulation began. Evidence for the inefficient herding is obs...
Article
We show that the optimal inflation target imposed on a discretionary central bank varies with the extent of fiscal decentralization. Our analysis compares two fiscal regimes for local government bond management: the partially decentralized (PD) regime where the central government determines the amount of local bond; and the fully decentralized (FD)...
Article
This paper investigates whether the benefits of bank–borrower relationships differ depending on three factors identified in the theoretical literature: verifiability of information, bank size and complexity, and bank competition. We extend the current literature by analyzing how relationship lending affects loan contract terms and credit availabili...
Article
Full-text available
Using unique data we test various trade credit theories and find the following. First, the length of a buyer-seller relationship has a positive impact on the use of trade credit, especially for longer-term credit. In contrast, short-term trade credit is extended based on buyers’ hard information. Second, trade credit is more frequently used for tra...
Article
Full-text available
December 2010 近未来の課題解決を目指した実証的社会科学推進事業
Article
This paper investigates whether depositors and market investors exert disciplinary pressure on bank management in terms of efficiency improvement. We find that banks with more outstanding deposits are more cost-efficient, although little effect is found with respect to profit efficiency. This implies that depositors, the primary providers of funds...
Article
Using unique data from Japan that match buyer firms with their main suppliers, we test multiple theories of trade credit. Our findings suggest four key determinants of trade credit use.: reduction of transaction costs through trade credit use; mutual signaling between banks and trade creditors which increases overall credit capacity; relative barga...
Article
This paper empirically investigates how banks evaluate the creditworthiness of small- and medium-sized enterprises (SMEs). Following SME loan underwriting literature that distinguishes among different lending technologies, we test whether the typical SME bank loan is underwritten primarily based on just a single technology. We find that although fi...
Article
Current theoretical and empirical research suggests that small banks have a comparative advantage in processing soft information and delivering relationship lending. The most comprehensive analysis of this view found using US data that smaller SMEs borrow from smaller banks and smaller banks have stronger relationships with their borrowers [Berger,...
Article
Previous research suggests that loan officers play a critical role in relationship lending by producing soft information about SMEs. For the first time, we empirically confirm this hypothesis We also examine whether the role of loan officers differs from small to large banks as predicted by Stein (2002). While we find that small banks produce more...
Article
This paper empirically investigates whether Japanese banks followed herd behavior as a result of financial deregulation in the 1980s, and whether any observed herd behavior brought about inefficiencies that could have caused macroeconomic fluctuations. Using loan-portfolio data, the paper examines Granger-causalities in lending behavior by differen...
Article
This paper investigates whether Japanese banks had been following herd behavior in the domestic loan market from 1975 through 2000. Applying the technique developed by Lakonishok, Shleifer, and Vishny [Lakonishok, J., Shleifer, A., Vishny, R.V., 1992. The impact of institutional trading on stock prices, J. Finan. Econ. 32, 23–43] to the data from l...
Article
We empirically examine the impact of bank consolidation on bankers' acquisition of soft information about borrowers. Using a dataset of small businesses, we found that bank mergers have a negative impact on soft information acquisition by small banks while those by large banks that have less interest in acquiring soft information irrespective of me...
Article
Full-text available
The current literature on SME loan underwriting assumes that banks use just one of two lending technologies: relationship lending for opaque SMEs and transactions-based lending for relatively transparent SMEs. Recent work has departed from this view and hypothesizes that banks use a variety of distinctly different lending technologies. It emphasize...
Article
This paper empirically investigates what determine bargaining power between a lender and a borrower who have continuing transactional relationships. Bargaining power is proxied by which side of the transaction, i.e. the lender or the borrower, usually incurs a shoe-leather cost when they have contact. The proxy is regressed on three types of variab...
Article
Theoretical and empirical work suggests that commercial loan officers play a critical role in relationship lending by producing soft information about their SME borrowers. We test whether loan officers in the Japanese SME loan market perform this role in a manner that is consistent with the theoretical predictions in the relationship lending litera...
Article
Full-text available
Using data from a unique survey in Japan, we investigate the relevance of different lending technologies which are utilized in lending to small- and medium-sized enterprises. We characterize loans from a technology point of view, and ask (i) to what extent different lending technologies are used, (ii) how complementary the technologies are, and (ii...
Article
Despite the importance of the hypothesis that trade creditors may act as relationship lenders, it has been virtually impossible to directly test this hypothesis because of a lack of data. We attempt to overcome this problem by using a relatively new Japanese database on small and midsized enterprises (SMEs) that contains information on the strength...
Article
Full-text available
This paper examines whether the efficiency structure hypothesis holds true for major Japanese commercial banks using panel data covering fiscal years 1974-2001. The efficiency structure hypothesis has been hitherto mostly examined in comparison with the structure-conduct-performance (SCP) hypothesis in the framework that determines which of the two...
Article
This paper investigates whether the benefits of bank-borrower relationships differ depending on three factors identified in the theoretical literature: verifiability of information, bank size and complexity, and bank competition. We extend the current literature by analyzing how relationship lending affects loan contract terms and credit availabili...
Article
This paper investigates whether competition in the Japanese banking sector has improved in the last quarter of the 20th century. By estimating the first order condition of profit maximization, together with the cost function and the inverse demand function, we found that competition had improved, especially in the 1970s and in the first half of the...
Article
We derive an optimal state-contingent inflation target in an economy under uncertainty. This inflation target can improve inefficiencies stemming from two sources: the lack of commitment to predetermined policies and the lack of coordination between the monetary and fiscal authorities. We then discuss the pros and cons of our proposal compared with...
Article
We consider how the second-best allocation corresponding to an optimal rule under the policy commitment of a central bank and a fiscal authority with a consolidated government budget constraint can be achieved, even though these authorities are unable to commit themselves to their optimal policies and ignore the strategic interaction between their...
Article
This paper explains the rationale behind deposit collateral that has not been discussed in the literature on financial contracting. In our model extending Hart and Moore (1998) to account for liquidity shocks, deposit collateral has potentially two important effects: the enhancement of pledgeability and the provision of liquidity. We show that only...
Article
The aim of this paper is to examine whether herd behavior exists or not between different types of Japanese banks. Using data of loans outstanding by types of banks from 1980 to 2000, we investigate statistical causality between loans from different types of banks in Japan. Time-series analysis manifested the causality from city banks to regional b...
Article
Full-text available
We provide a model that can describe a nature of competition in Japanese banking industry. By applying the theory of common agency, we formally explain the fact that there are two forms of loan syndication, "de facto" and "formal," which cannot be explained by the existing studies. We show that banks may choose either form and that the key to the c...
Article
Full-text available
This paper examines whether the efficiency structure hypothesis holds true for Japanese major commercial banks using a panel data set covering the period from fiscal year 1974 to 2001. The efficiency structure hypothesis has been hitherto mostly examined in comparison with the structure-conduct-performance (SCP) hypothesis in the framework that det...

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