JPOSS #46: “Friend-Shoring without Decoupling: How Japanese Multinational Corporations Adapt to Political Risk in China”

The forty-sixth session of the Japanese Politics Online Seminar Series (JPOSS) took place on March 28, 2024. Phillip Y. Lipscy (University of Toronto) chaired the seminar and moderated the Q&A session.

Timothy Cichanowicz (University of Kansas) presented a paper, co-authored with Samantha A. Vortherms (University of California, Irvine) and Jiakun Jack Zhang (University of Kansas), focusing on firm behavior in response to political risk in China. The authors exploit longer periods of data on behavior by Japanese firms—early movers in response to disputes between China and Japan—to test their theories on shifts in investment from China to other countries in general (“de-risking”) as well as to countries with security ties to Japan (“friend-shoring”). Based on their analysis, the authors argue for the presence of friend-shoring but lack of evidence for de-risking.

Lee Branstetter (Carnegie Mellon University) and Kristin Vekasi (University of Maine) offered insightful comments and suggestions on conceptual clarity, empirical measures, and considerations regarding context, among others. During the Q&A session, participants furthered the discussion on alternative empirical strategies and ways to overcome data availability constraints.

The organizers would like to thank the presenters, discussants, and participants, as well as the staff at the Harvard Program on U.S.-Japan Relations, who provided administrative support. We look forward to seeing you at the next session of JPOSS: https://jposs.org/.

Originally published on the Japanese Politics Online Seminar Series blog. Original publication can be found here.