Japan’s main measures to tackle the issues relating to “zombie enterprises” and enlightenment

YIN Jialin1 ZOU Guoqing1

(1.Business School, Jilin University, Changchun, Jilin, China 130012)

【Abstract】Against the backdrop of changed international economic environment and adjusted development models, Japan experienced three crises relating to large-scale zombie enterprise.To tackle these crises, Japan gave full play to role of market in selecting enterprises that needed to go bankrupt or to be reorganized.During this process, Japan paid special attention to the re-training and job placement of laid-off workers. It also established some ad hoc institutions to implement laws and regulations for these crises. Based on its own characteristics, China can learn from Japan to address the issues relating to “zombie enterprise.”

【Keywords】 zombie enterprises; overcapacity; reorganization; financial dilemma; revitalization agencies;


【Funds】 National Social Science Foundation Project (15BGL008) National Soft Science Research Program Project (2010GXS5D195)

Download this article


    [1]. ① Such as mergers and acquisitions of enterprises, sustained loans from banks and subsidies from local governments. [^Back]

    [2]. ② Such as other healthy enterprises, commercial banks and local governments. [^Back]

    [3]. ① Japan’s national average land price refers to the average land price of all cities in Japan. [^Back]

    [4]. ② Six metropolises are Tokyo Area, Yokohama, Nagoya, Kyoto, Osaka and Kobe. [^Back]

    [5]. ③ In Figures 2–5, the land price index of March 2000 is set to 100. [^Back]


    [1] FUKUDA S I, NAKAMURA J I. Why Did “Zombie” Firms Recover in Japan?. The World Economy, 2011, 34 (7): 1124–113.

    [2] CHAKRABORTY S, PEEK J. Cherry-Picking Winners or Aiding the Distressed? Anatomy of a Financial Crisis Intervention, Working Paper (2012).

    [3] KAWAI M, MORGAN P. Banking Crises and “Japanization”: Origins and Implications. Working Paper 430 (2013).

    [4] KANE E J. Dangers of Capital Forbearance: The Case of the FSLIC and “Zombie,” S&Ls, Contemporary Economic Policy, 5 (1): 77–83(1987).

    [5] KANE E J. What Lessons Should Japan Learn from the U. S. Deposit-Insurance Mess?. Journal of the Japanese and International Economies, 7(4): 329–355 (1993).

    [6] BROOKE J. They’re Alive! They’re Alive! Not! Japan Hesitates to Put an End to Its ‘Zombie’ Enterprises, Bank of America is a Good Example of a Zombie Company, New York Times (2002-10-29).

    [7] RIDZAK T. Lending Activity and Credit Supply to Firms during the Crisis-Evidence from the Croatian Micro Level Data, the Seventeenth Dubrovnik Economic Conference, Croatian: Croatian National Bank (2011).

    [8] HOSHI T, KIM Y. Macro-prudential Policy and Zombie Lending in Korea, Working Paper (2012).

    [9] Huang, Q. & Li, X. Guangming Ribao (光明日报), (2016-04-13).

    [10] Tsukami, T. Comparative Studies (比较), 3: 25–33 (2016).

    [11] Xiong, B. Reform (改革). (3): 120–127 (2016).

This Article


CN: 22-1065/F

Vol 36, No. 04, Pages 58-68

July 2017


Article Outline


  • 1 Definition of “zombie enterprises”
  • 2 Three major issues with “zombie enterprises” in Japan
  • 3 Japan’s main measures to tackle the issues relating to “zombie enterprises”
  • 4 Enlightenment
  • Footnote