Amakudari

AAA

DEFINITION of 'Amakudari'

A Japanese business practice in which senior politicians retire to executive or high-profile positions within the corporate realm. Meaning "descent from heaven," amakudari as a practice shifts retired bureaucrats to industries related to the public sector work that they retired from, creating a strong bond between private and public sectors.

BREAKING DOWN 'Amakudari'

Amakudari as a practice has been increasingly associated with corruption and a tie to old, outdated ways of doing business. The practice is considered corrupt because it creases a strong incentive for retired bureaucrats to resist reforms, since their high level jobs are directly related to their connections with the government. It is considered outdated because Japanese businesses often operate in a very hierarchical manner, with particular emphasis placed on seniority. This has been said to make advancement through merit difficult.

RELATED TERMS
  1. Private Sector

    The part of the economy that is not state controlled, and is ...
  2. Corporate Ladder

    A conceptualized view of a company's employment hierarchy in ...
  3. Promotion

    1.In terms of a career, a promotion refers to the advancement ...
  4. Japan Inc.

    A nickname for the corporate world of Japan that came about during ...
  5. Kaizen

    A philosophy that sees improvement in productivity as a gradual ...
  6. Keiretsu

    A Japanese term describing a loose conglomeration of firms sharing ...
Related Articles
  1. Bonds & Fixed Income

    Dragons, Samurai Warriors And Sushi On Wall Street

    From samurai to sushi, there's no denying the East Asian influence on investing terminology.
  2. Economics

    Lessons Learned: Comparing The Japanese And U.S. Bubbles

    Find out what the Japanese and U.S. bubbles can tell us about recovering from financial chaos.
  3. Economics

    Tankan Survey Provides Clues To Japanese Economy

    This quarterly survey is crucial for assessing Japan's economic health.
  4. Insurance

    Understanding Japanese Keiretsu

    The structure of major companies in Japan is steeped in tradition and relationships.
  5. Mutual Funds & ETFs

    Top 3 Switzerland ETFs

    Explore detailed analysis and information of the top three Swiss exchange-traded funds that offer exposure to the Swiss equities market.
  6. Mutual Funds & ETFs

    ETF Analysis: SPDR Dow Jones International RelEst

    Learn how the SPDR Dow Jones International Real Estate exchange-traded fund (ETF) is managed and for whom the ETF is most appropriate.
  7. Investing Basics

    Explaining Trade Liberalization

    Trade liberalization is the process of removing or reducing obstacles that impede the exchange of goods and services between nations.
  8. Economics

    What is a Code of Ethics?

    A code of ethics is a collection of principles and guidelines an organization expects its employees to follow.
  9. Economics

    Explaining the Balanced Scorecard

    A balanced scorecard is a metric that measures a business’ performance.
  10. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI South Africa

    Learn more about the iShares MSCI South Africa fund, which is an NYSE-listed exchange-traded fund offered and managed by BlackRock.
RELATED FAQS
  1. Is Japan an emerging market economy?

    Japan is not an emerging market economy. Emerging market economies are characterized by low per capita incomes, poor infrastructure ... Read Full Answer >>
  2. What kinds of costs are included in Free on Board (FOB) shipping?

    Free on board (FOB) shipping is a trade term published by the International Chamber of Commerce or ICC, that indicates which ... Read Full Answer >>
  3. What are the differences between B-shares and H-shares traded on Chinese stock exchanges?

    Equity listings in China generally fall under three primary categories: A shares, B shares and H shares. B shares represent ... Read Full Answer >>
  4. What are the differences between H-shares and A-shares on Chinese and Hong Kong stock ...

    Publicly trade companies in China generally fall under three share categories: A shares, B shares and H-shares. A-shares ... Read Full Answer >>
  5. Why are financial markets considered to be transparent?

    Financial markets are considered transparent due to the fact it is believed all relevant information is freely available ... Read Full Answer >>
  6. How does a Foreign Institutional Investor (FII) manage currency risk when investing ...

    A foreign institutional investor (FII) manages currency risks (inflation and exchange rate risk) by using traditional tools ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Stock Market Crash

    A rapid and often unanticipated drop in stock prices. A stock market crash can be the result of major catastrophic events, ...
  2. Financial Crisis

    A situation in which the value of financial institutions or assets drops rapidly. A financial crisis is often associated ...
  3. Election Period

    The period of time during which an investor who owns an extendable or retractable bond must indicate to the issuer whether ...
  4. Shanghai Stock Exchange

    The largest stock exchange in mainland China, the Shanghai Stock Exchange is a nonprofit organization run by the China Securities ...
  5. Dead Cat Bounce

    A temporary recovery from a prolonged decline or bear market, followed by the continuation of the downtrend. A dead cat bounce ...
  6. Bear Market

    A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!