Outline This thesis uses network analysis to study the inter-company relationships of Taiwanese business groups, specifically focusing on ¡§licensed¡¨ industries. So-called licensed industries are defined in this context as those that require government approval to enter . In the past, there were many industries that were monopolies or oligopolies as a direct result of government policy. In line with the trend towards greater liberalization and globalization, the Taiwanese government has begun a step-by-step deregulation of these business sectors. This thesis selects two industries, banking and telecommunications, and attempts to discover patterns of cooperative relationships among the participating Taiwanese business groups. Through investigating the licensed industries, we discovered that government permits are generally concentrated among large business groups, due to the capital requirements involved. In addition, we established that existing relationships and connections are very important considerations when these large business groups decide with whom to cooperate. Within the cooperation network as a whole, there exist apparent subgroups (cliques), which routinely form into stable cooperation groups. On the other hand, some business groups chose their partners without any obviously apparent pattern. Finally, and most importantly of all, we observed that a ¡§Birds of a feather flock together¡¨ phenomenon clearly exists in Taiwanese business groups. Large business groups are prone to cooperating with large business groups and small business groups are inclined to choose small ones to cooperate with.