We analyze Korean chaebols as one decision unit where controlling parties centrally influence investment and financing decisions of member firms. Borrowing the methodology used in the literature of diversification study in the U.S., we find that the mean and median excess values of member firms are positive and the aggregate excess value of the chaebol is nonnegative.
We find that a higher ratio of cash flow rights relative to control rights of controlling parties increases the value of internal capital markets and the group excess value in the post Asian crisis period of 1998-2001. In addition, we do not find evidence that the credit crunch after the Asian crisis affects chaebol member firms more seriously than independent firms.
Key Word: governance, business group, chaebol, valuation, internal capital market
학회 소식
공지사항
[2005년 제 2차] Governance Discount: Valuation of the Korean busine
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게시일 :
2005-06-03