The limited liability system of all partners was permitted in Japan first by the Bank of Issue Act (Kokuritsu-Ginko Jorei) of 1872. Business Companies in general started to adopt the limited liability system when the first Commercial Law was enforced in 1893, and the joint-stock company with limited liability in its strict sense was not materialized until the amendment of the Commercial Law in 1899. Before then, however, the House of Mitsui had managed to introduce into its subsidiaries the effect of limited liability system by making full use of the Family Registration Law, and tried to avoid the unlimited responsibility for its subsidiaries. In this article I tried to elucidate these elaborate means and make it clear that the primary objective of the reorganization in 1909 of the Mitsuis subsidiaries on the basis of joint-stock system was not the establishment of limited liability but was rather the rationalization of management in its own way.
The making of the Public Utility Holding Company Act of 1935 implies an important role played by public utility holding companies in the development of the bull stock market in the late 1920's. A holding company, whose aim is to hold other companies' securities in order to get controlling power, first appeared in the field of manufacturing industry around 1890. But, under legislative regulations such as Sherman Act or Clayton Act, holding companies were deprived of chances to flourish in the manufacturing industry, and were replaced by some other legal means of capital concentration. They found themselves again, however, in the newly developed industry, public utilities, in the 1910's, and this was the place for their full activities all through the prosperity decade of the 1920's. Why in public utilities, not in other fields ? Who created holding companies in public utilities ? The author attempted in this paper to answer these questions by illustrating the development of major holding companies in the 1910's.
Representative theories of innovation developed for business history studies by such scholars as J. A. Schumpeter, F. Redlich and T. C. Cochran, have mostly emphasized the innovative behaviors of business firms or business executives in order to explain the economic growth and or economic development. They can be grouped under the category of “a macro theory of innovation”. In order to make an analysis of innovations generated within business organizations themselves, Business History needs “a micro theory of innovation”. This micro theory of innovation does not aim to answer macro economic questions, but is primarily designed to explain the innovations within individual business firms. “The behavioral theory of organizational decision-making”, developed by Chester I. Barnard, Herbert A. Simon, and James G. March, have its main research interests precisely on this “innovation” in its organizational context, and eventually there 'evolved a “behavioral theory of innovation”. Applying it, Business History's micro analysis of innovation would surely make great strides.