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.

INVESTOPEDIA EXPLAINS '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Amakudari as a practice has been increasingly associated with corruption and a tie to old, outdated ways of doing business.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 It is considered outdated because Japanese businesses often operate in a very hierarchical manner, with particular emphasis placed on seniority.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. Kaizen

    A philosophy that sees improvement in productivity as a gradual ...
  5. Japan Inc.

    A nickname for the corporate world of Japan that came about during ...
  6. Keiretsu

    A Japanese term describing a loose conglomeration of firms sharing ...
RELATED FAQS
  1. What does 'Incoterms' mean in relation to Ex Works (EXW) trades?

    Ex works is part of the published Incoterms and outlines the obligations of transportation to buyers and sellers. The International ... Read Full Answer >>
  2. What developed countries have the greatest exposure to the automotive sector?

    The developed countries with the greatest exposure to the automotive sector are Japan and Germany. This is based on exposure ... Read Full Answer >>
  3. What are the differences between Ex Works (EXW) and Free On Board (FOB)?

    Ex Works (EXW) and Free on Board (FOB) are Incoterms used to describe situations where sellers deliver goods. Ex Works describes ... Read Full Answer >>
  4. How is productivity calculated?

    Productivity measures the efficiency of a company's production process. It is calculated by dividing the outputs produced ... Read Full Answer >>
  5. How are international investment banking practices regulated?

    The first step in creating international investment banking regulations occurred in 1930, when the Bank for International ... Read Full Answer >>
  6. What is the difference between comparative advantage and absolute advantage?

    Absolute and comparative advantage are two important concepts in international trade that largely influence how and why nations ... Read Full Answer >>
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. Investing News

    A New Corporate Governance Initiative In Japan

    Expectations are low that Japan can create a corporate governance climate that meets global standards, but a new initiative is aimed at doing just that.
  6. Economics

    Can The U.S Close Its Trade Deficit?

    The stronger dollar could have increased the U.S. trade deficit. Instead, economic growth issues abroad and falling oil prices have helped shrink it.
  7. Mutual Funds & ETFs

    Best ETFs for Investing in Japan

    Japan is printing money, which is likely to lead to continue strong performance in the Nikkei. The following ETFs offer exposure in different ways.
  8. Economics

    A Risky Maneuver To Jumpstart Japan's Economy

    Japan's government and the Bank of Japan are buying large amounts of government bonds in an effort to spark economic activity, but there are great risks.
  9. Investing

    Why North Korea & South Korea Are Separated

    Once united for centuries, today North and South Korea are perfect examples of opposite worlds, divided by politics and ideologies.
  10. Chart Advisor

    Is Now the Time to Invest in North America?

    Bullish chart patterns across the North American markets suggest that now might actually be a wise time to allocate closer to home.

You May Also Like

Hot Definitions
  1. Fixed-Income Arbitrage

    An investment strategy that attempts to profit from arbitrage opportunities in interest rate securities. When using a fixed-income ...
  2. Venture-Capital-Backed IPO

    The selling to the public of shares in a company that has previously been funded primarily by private investors. The alternative ...
  3. Merger Arbitrage

    A hedge fund strategy in which the stocks of two merging companies are simultaneously bought and sold to create a riskless ...
  4. Market Failure

    An economic term that encompasses a situation where, in any given market, the quantity of a product demanded by consumers ...
  5. Unsystematic Risk

    Company or industry specific risk that is inherent in each investment. The amount of unsystematic risk can be reduced through ...
  6. Security Market Line - SML

    A line that graphs the systematic, or market, risk versus return of the whole market at a certain time and shows all risky ...
Trading Center