ABSTRACT
After the 1990s, Asian capitalisms achieved extraordinarily fast growth in “international production sharing” (the splitting up of value-added chains). Multinational firms played an important role in the process of globalization and regional integration (Coriat et al. 2006). 1 In particular, the Japanese multinational firms' (JMNs) activities and foreign direct investments (FDI) have been instrumental in creating international production linkages, thus promoting economic integration in the East Asian region. Asian capitalisms have accomplished dynamic economic growth by participating in international production sharing in East Asia. However, the subprime crisis was the catalyst for a serious global economic downturn in 2008. Significant reduction in exports, resulting from the declining import demand from the USA and European countries, had a significant impact on the export-oriented East Asian economies. Although there is growing evidence that production and trade associated with FDI is the driving force behind increasing interdependence in the East Asian economies, especially in China, one can be less certain about the exact impact of the crisis on the economic integration process in East Asia. In this situation, JMNs are assisting in the tighter formation of international production linkages between Japan and Asian host countries.
