ABSTRACT
This chapter analyzes two keiretsu organizations — Mitsui and Mitsubishi. It highlights changes in the international environment to which state and business actors reacted collectively. Each stage of keiretsu development involves growing keiretsu structures, the result of collective responses from state and business actors to changing international economic environments. The chapter also highlights the process of restoring trust not only among ex-zaibatsu member firms but also between the state and business. It explains state actions regarding banks, since the question of the post-war financial system bears the key to the entire issue of keiretsu formation. The chapter describes the process of keiretsu expansion. It examines reasons why small and medium firms could not survive without joining a keiretsu, not to mention those new big firms that demonstrated enormous post-war economic potential. The new Japanese state was a very active participant not only in the zaibatsu purge but in the formation of the keiretsu as well.
