Journal article
Chaebol, Investment Opportunity Set and Corporate Debt and Dividend Policies of Korean Companies
Review of Quantitative Finance and Accounting, Vol.13(4), pp.401-416
1999
Abstract
This paper examines explanations for the association between Korean Chaebol, which are giant conglomerates supported by various government initiatives, and corporate debt and dividend policies. Unlike in the US, the Korean corporate sector is dominated by the Chaebol which are characterized by concentrated family ownership, political affiliation and bank ownership. These institutional arrangements are likely to encourage more debt financing. In addition, the study also investigates whether firms with more growth options measured in terms of the investment opportunity set (IOS) have lower leverage and dividends. Results using observations from 411 Korean firms showed that for a fixed level of growth opportunities, Chaebol carry higher levels of debt. Results also show that growth options were negatively associated with leverage and dividends. No association, however, was found between Chaebol and dividends.
Details
- Title
- Chaebol, Investment Opportunity Set and Corporate Debt and Dividend Policies of Korean Companies
- Authors
- Ferdinand Gul (Author) - City University of Hong KongBurch Kealey (Author) - City University of Hong Kong
- Publication details
- Review of Quantitative Finance and Accounting, Vol.13(4), pp.401-416
- Publisher
- Springer New York LLC
- DOI
- 10.1023/A:1008397808221
- ISSN
- 1573-7179
- Organisation Unit
- University of the Sunshine Coast, Queensland; School of Business and Creative Industries
- Language
- English
- Record Identifier
- 99678893602621
- Output Type
- Journal article
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