Twentieth century enterprise forms: Japan in comparative perspective

La Porta et al see Anglo-American common law as most favourable to economic development, but in 1899 Japan explicitly preferred the German corporate law tradition. Yet its new Commercial Code omitted the GmbH (private company) form, which Guinnane et al see as the jewel in the crown of Germany’s organizational menu. Neither apparent “mistake” retarded Japan’s business development because its corporate laws offered flexible governance and liability options, implemented liberally. Surprisingly (given that Germany’s organizational menu predated Japan’s by many decades and the country was wealthier), by the 1930s Japanese businesses already used not only corporations proper (kabushiki kaisha) but also commandite partnerships (goshi kaisha, with more corporate characteristics than Anglo-American partnerships) more intensively than Germany. After the introduction of the yugen kaisha (a GmbH-equivalent) in 1940, corporate forms were nearly as widely used in Japan as in the US, the UK or Switzerland.