Abstract: This study examines the impacts of several factors, such as internal capital markets, technology transfer via FDI, and in-house R&D activities on the performance and growth of firms using data gathered from the top 200 companies... more
Abstract: This study examines the impacts of several factors, such as internal capital markets, technology transfer via FDI, and in-house R&D activities on the performance and growth of firms using data gathered from the top 200 companies in China during the period 1998-2003. A finance company, as an affiliate in the business group, is used as proxy for the internal capital market. The foreign joint venture firms and in-house research center are used as proxies for technology transfer and for the existence of in-house R&D activities, ...
This paper aims to conceptualize the modes of knowledge transfer from PROs and to identify the impacts of the modes on firm performance. To these ends, this utilizes the Survey on Korean industry-university/PRI relationships to estimate... more
This paper aims to conceptualize the modes of knowledge transfer from PROs and to identify the impacts of the modes on firm performance. To these ends, this utilizes the Survey on Korean industry-university/PRI relationships to estimate the impacts of its mode in terms of the innovation probability, patents and sales of Korean firms. First, we find that non-IP modes of knowledge transfer and patent/licensing from PROs facilitate the innovation probability or the patent-filing of firms, while business activity does not. Second, non-IP modes of ...
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A structuralist macroeconomics perspective is taken to interpret the two recent financial crises in Korea, and new policy framework and reform measures are suggested to build a crisis-resilient macrofinancial system. This paper focuses on... more
A structuralist macroeconomics perspective is taken to interpret the two recent financial crises in Korea, and new policy framework and reform measures are suggested to build a crisis-resilient macrofinancial system. This paper focuses on the “Frenkel-Neftci” cycle (Taylor 1998) and the two kinds of expected spreads, interest spread and capital gain spreads, which initially motivate foreign investment in emerging economies. To establish a crisis-resilient macro-financial system, a new macro policy framework that can be ...
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The post-liberalization era has witnessed a significant increase in foreign direct investment (FDI) inflows and intra-industry trade (IIT) of India. Considering this fact, the article attempts to investigate a causal relationship between... more
The post-liberalization era has witnessed a significant increase in foreign direct investment (FDI) inflows and intra-industry trade (IIT) of India. Considering this fact, the article attempts to investigate a causal relationship between FDI and IIT in the manufacturing sector of India for the period 1992–2013. Causality across various industries of the manufacturing sector has also been analyzed. For the manufacturing sector, causality tests depict unidirectional causality from IIT to FDI. The results at industry level vary across different industries. For majority of the industries, it is found that FDI inflows have led to an increase in IIT for the manufacturing sector of India.
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Utilizing insights from new growth theory, Porter's competitive advantage theory, and Kojima's theory of DFI, this paper analyzes the overall growth mechanism of the Korean economy by integrating various dimensions, such as... more
Utilizing insights from new growth theory, Porter's competitive advantage theory, and Kojima's theory of DFI, this paper analyzes the overall growth mechanism of the Korean economy by integrating various dimensions, such as factor intensity changes, sectoral growth, trade performance, and direct foreign investment. This paper points out" knowledge accumulation" as one of the engines of growth in the Korean economy, and shows that although knowledge intensity has steadily increased over the last decade, Korean ...
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An increasing number of Chinese companies are now taking the form of the business group. The big business groups in China tend to have more state shares, be more heavily indebted, less profitable, and accumulating capital more slowly than... more
An increasing number of Chinese companies are now taking the form of the business group. The big business groups in China tend to have more state shares, be more heavily indebted, less profitable, and accumulating capital more slowly than non-group firms. The emergence of the business groups was an outcome of entry into new profitable business fields by the existing companies given that exit from the old business fields was not easy due to institutional constraints. In this case, entry or expansion into new business ...
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This paper analyzes problems in China's enterprise reform from property rights and agency problem perspectives. Reform efforts by the mid 1980s are interpreted as dealing with only the agency problem by relocating the... more
This paper analyzes problems in China's enterprise reform from property rights and agency problem perspectives. Reform efforts by the mid 1980s are interpreted as dealing with only the agency problem by relocating the decision process among agents, but not solving the hierarchical collusion problem. The shareholding system experiment is the first effort to deal with property rights relations. Although it seems to have contributed to some improvement in enterprise performance, there still remains the problem of expropriation of state assets by ...
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Summary This paper has discussed several issues regarding the barriers and opportunities for technological catch‐up by the late‐comer countries and firms. As one of the barriers to technological catch‐up, the paper emphasizes the... more
Summary This paper has discussed several issues regarding the barriers and opportunities for technological catch‐up by the late‐comer countries and firms. As one of the barriers to technological catch‐up, the paper emphasizes the uncertainty involved with the third stage of learning how to design. The barriers arise because as the forerunner firms refuse to sell or give license to successful catching‐up firms who thus have to design the product by themselves. The paper discusses how to overcome this barrier. It also notes that if the ...
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The existence of the business groups has been associated with market failure in emerging economies, and thus their performance has been argued and found to have declined with development of market institutions surrounding them. This paper... more
The existence of the business groups has been associated with market failure in emerging economies, and thus their performance has been argued and found to have declined with development of market institutions surrounding them. This paper takes up this issue of long-term performance of the business groups but argues that it has also to do with the internal problems, such
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This paper first compares,productive efficiency of Chaebols and non-Chaebol firms in Korea. The first contribution of this paper lies in that we have treated each Chaebolgr oup as a single entity consisting of tens of affiliated firms.... more
This paper first compares,productive efficiency of Chaebols and non-Chaebol firms in Korea. The first contribution of this paper lies in that we have treated each Chaebolgr oup as a single entity consisting of tens of affiliated firms. This is important since affiliated firms in a Chaebol are not really independent firms. They are subject to centralized control, evaluation and
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This study deals with the convergence and divergence issue in terms of the possible difference in the knowledge-sourcing behaviour of latecomer and incumbent firms. Consequently, empirical analysis using the patent citation data shows... more
This study deals with the convergence and divergence issue in terms of the possible difference in the knowledge-sourcing behaviour of latecomer and incumbent firms. Consequently, empirical analysis using the patent citation data shows that no significant difference exists in the knowledge-sourcing behaviour of the incumbents and latecomers in long-cycle time-based sectors, particularly in terms of whether each type of firm relies more or less on ‘recent’ and ‘scientific’ knowledge. By contrast, a significant difference is observed in the short-cycle technology-based sectors, such that the latecomer firms tend to rely more on ‘recent’ and ‘scientific’ knowledge than the incumbents. Thus, the findings suggest that the answer to the question of whether convergence or divergence exists in knowledge sourcing is that it depends on the knowledge regime of the sectors, specifically on the cycle time of the technologies of sectors. This finding is consistent with the reasoning that the latecomer firms can afford to rely only on recent technologies in short-cycle sectors in which technologies tend to change quickly or become obsolete; latecomer firms are also keen on their knowledge sourcing to broadly search not only into technological knowledge (patents) but also into scientific knowledge (articles) in short-cycle sectors with rapid change of technologies.
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ABSTRACT: Analysing the case of Samsung Electronics’ mobile phone business, this paper examines the effects of establishing factories abroad on domestic jobs and the issue of technological hollowing out. The offshoring of mobile phone... more
ABSTRACT: Analysing the case of Samsung Electronics’ mobile phone business, this paper examines the effects of establishing factories abroad on domestic jobs and the issue of technological hollowing out. The offshoring of mobile phone assembly to China, India, Brazil and Vietnam did not result in a reduction of domestic jobs. On the contrary, Samsung’s domestic employment increased from 5960 persons in 2002 to 20,500 in 2012. This increase mainly reflects a net increase in high-paying jobs (R&D, engineering, design, marketing) while the number of low-paying jobs (assembly) remained stagnant. To cope with possible technological hollowing out, Samsung kept its core engineers/technicians in a special unit, instead of firing them, whenever domestic assembly lines were reduced or foreign lines were established. They were kept inside the so-called “global manufacturing technology center,” with the number of its employees increasing from 80 in 2006 to more than 1103 in 2011. These employees visit overseas factories to conduct activities such as maintenance, monitoring, re-modeling of assembly lines, and automation. In terms of strategy, Samsung engages in offshoring, but not outsourcing. This is in contrast to Apple which does both offshoring and outsourcing by contracting with Foxconn. Review of World Economics 08/2015; 151(3). DOI:10.1007/s10290-015-0219-8 · 0.78 Impact Factor
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The existence of the business groups has been associated with market failure in emerging economies, and thus their performance has been argued and found to have declined with development of market institutions surrounding them. This paper... more
The existence of the business groups has been associated with market failure in emerging economies, and thus their performance has been argued and found to have declined with development of market institutions surrounding them. This paper takes up this issue of long-term performance of the business groups but argues that it has also to do with the internal problems, such as changes in the ownership and governance structure. It finds, with the Korea data and new method and theoretical grounds, that the relative performance of the business groups, the Chaebols, had consistently declined over the 1980s and 1990s although they were more efficient than the non-Chaebol firms during the early 1980s. The results are robust to different estimation methods, and also to controls for the possible survivorship bias, industry composition, and scale effects. The paper explains the performance change by examining the decrease of the shares held by the controlling families and the associated aggrava...
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The paper identifies the need for improvements in policy space for developing and least developed countries under the current world trading system by examining the use of WTO dispute settlement system with descriptive statistics and case... more
The paper identifies the need for improvements in policy space for developing and least developed countries under the current world trading system by examining the use of WTO dispute settlement system with descriptive statistics and case studies. The paper shows an asymmetry in the utilization of the dispute settlement system and the consequence of using the system between developed and developing countries. For instance, the paper demonstrates that the United States and some other developed countries use WTO rules effectively, resulting in the defeat of developing countries in disputes. These developing countries are forced to abandon their industrial policy measures. By contrast, the United States and the other developed countries continue to use WTO-inconsistent industrial policies in need without being much effectively challenged. Based on our findings, we suggest what should be done within the practices of the current rules, what can be done to change the current global rules, and what developing countries can still try under the current rules.
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This paper revisits the recent debate on the determinants of long-run economic growth with the simple idea that different factors matter at different country groups classified by income levels. This paper improves on the methodology by... more
This paper revisits the recent debate on the determinants of long-run economic growth with the simple idea that different factors matter at different country groups classified by income levels. This paper improves on the methodology by conducting not only cross-section estimations but also fixed-effects panel and system-GMM estimations. The results suggest that new policy variables such as technology and tertiary education, as well as institutions, matter as the determinants of long-run economic growth. In addition, this paper finds that ...
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Research Interests: Publishing, Biotechnology, Science, Developing Countries, Technology transfer, and 15 moreInternational Cooperation, Health Equity, Public sector, Health Policy, Multidisciplinary, Organizational structure, Humans, Biomedical Research, Developing Country, Diffusion of Innovation, Developed Countries, Innovation Network, Private Sector, Drug Industry, and Delivery of Health Care
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Research Interests: Intellectual Property, Economic Growth, Policy, Economic Development, Firm Performance, and 13 moreGrowth, Developing Country, Firm-Level Data, Business and Management, Firm Growth, Case Study, Intellectual Property Protection, Imitation, Model development, Developing Economies, Intellectual Property Right, Low Income, and Innovation
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Abstract: Places Korean chaebols (ie family-owned conglomerates) in the context of organizational theory, characterizes them as leveraged controlling minority structure firms and discusses the behavioural consequences of this. Examines... more
Abstract: Places Korean chaebols (ie family-owned conglomerates) in the context of organizational theory, characterizes them as leveraged controlling minority structure firms and discusses the behavioural consequences of this. Examines their long term performance in terms of diversification/changinb business environment, aggressive investment drive and the effects of management by one man. Considers the necessary conditions for efficient corporate governance and relates them to various Korean reforms, eg to protect minority ...
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In the past decade, increasing economic integration with China has offered vast business opportunities to Korean firms. Given the changing industry map in East Asia, Korean firms have been seeking a new international division of labor... more
In the past decade, increasing economic integration with China has offered vast business opportunities to Korean firms. Given the changing industry map in East Asia, Korean firms have been seeking a new international division of labor with Chinese firms via foreign direct investment. During the last two decades, Korean firms in China attempted to create business models that implemented either a full set of business activities (full model) or a partial set of business activities (partial model). We have found that the competitiveness of Korean firms ...
Research Interests: East Asia, Foreign Direct Investment, Division of labor, China, Economic integration, and 10 moreApplied Economics, Environmental Change, Business Model, Public Administration and Policy, Bargaining Power, Manufacturing Sector, International Division of Labor, Category Killer, Finance and Investment Banking, and Catching up
This article investigates in comparative perspective the behavior and strategies of FDI firms in China from South Korea, the United States, and Hong Kong. We compare the firms' motivations for FDI, sectoral... more
This article investigates in comparative perspective the behavior and strategies of FDI firms in China from South Korea, the United States, and Hong Kong. We compare the firms' motivations for FDI, sectoral distribution of FDI and ownership advantages, corporate governance and ownership, and linkage with local Chinese firms. Our study has four major findings. First, on motivations for investment, the Korean FDI firms in China aimed to use China as an export-processing base, whereas the US FDI firms tend to target local ...
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Abstract The transformation of the old state enterprises into shareholding corporations is now being attempted as one form of corporatization in China. The Chinese authorities intend to encourage public‐oriented legal persons as... more
Abstract The transformation of the old state enterprises into shareholding corporations is now being attempted as one form of corporatization in China. The Chinese authorities intend to encourage public‐oriented legal persons as shareholders for these shareholding corporations. This strategy, which can be termed 'legal person socialism', may be successful to the extent that corporatization brings in more funds and autonomy to the enterprises, but eventually more and more individual shareholders will have to be invited. Only currently ' ...
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Business groups play significant economic roles in many countries. Motivated by the observation that the literature on business groups is ever-expanding yet providing ambiguous or conflicting results based on empirical investigations,... more
Business groups play significant economic roles in many countries. Motivated by the observation that the literature on business groups is ever-expanding yet providing ambiguous or conflicting results based on empirical investigations, this paper intends to first develop a theoretical model to explain behavior and performance of business groups and then conduct complementary empirical analysis. Drawing on Penrose's (1959) resource-based theory of firm growth, this paper models the firms of which some key resources are ...
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This paper adjusts the official data from North and South Korean sources, taking into account hidden inflation to estimate North Korea's GNP growth rates from 1954 to 1989. The factors of economic growth are decomposed... more
This paper adjusts the official data from North and South Korean sources, taking into account hidden inflation to estimate North Korea's GNP growth rates from 1954 to 1989. The factors of economic growth are decomposed subsequently into changes in inputs and factor productivity. Finally, a panel cointegration technique is used to assess the level of productivity in the North Korean economy in comparison with that of the former Soviet Union. We find that the average of annual growth rates of North Korean GNP and GNP per capita ...
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Ten years have passed since Korea underwent a severe financial crisis in 1997-98. The crisis prompted the Korean government to undertake a number of reforms in finance, corporate governance, and labor market. This paper analyzes the... more
Ten years have passed since Korea underwent a severe financial crisis in 1997-98. The crisis prompted the Korean government to undertake a number of reforms in finance, corporate governance, and labor market. This paper analyzes the dynamics of the reform process and assesses the outcomes of the reforms, which aimed at introducing the Anglo-Saxon economic model. It argues that the reform outcomes were conditioned on the interplay of local-specific conditions and interest politics and that the reforms were intent ...
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This study analyzes the academy-run enterprises (AREs) in China, which have played an important role in the development of high-tech industries in China, but have rarely been deeply addressed in previous studies. The AREs, despite... more
This study analyzes the academy-run enterprises (AREs) in China, which have played an important role in the development of high-tech industries in China, but have rarely been deeply addressed in previous studies. The AREs, despite ostensibly sharing some similarities with the academic spin-offs (ASOs) found in other countries, have distinct historical origins and characteristics in China. In this study, we try to clarify the distinct features of Chinese AREs, particularly in terms of their relationship with their mother institutions, using questionnaire survey data collected from 102 AREs and subsequent follow-up interviews with the ARE managers. This study finds that, while the AREs have enjoyed an exclusive right to exploit various assets of their mother institutions, they have suffered from the interventions of the mother institutions and ambiguous property right arrangements with the mother institutions. More recently, AREs have begun to evolve in response to the changing enviro...
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Abstract The paper explores the complex relationship among innovation, technological regimes and selection of the firms of different organizational forms in the evolution of an industry. For this purpose, this paper develops a... more
Abstract The paper explores the complex relationship among innovation, technological regimes and selection of the firms of different organizational forms in the evolution of an industry. For this purpose, this paper develops a 'history‐friendly'model for the dynamic random access memory industry that replicates the history of the industry by simulation. The shift of industry dominance by small, specialized (SS) firms to large, diversified (LD) firms is explained by the technological regimes of the industry, characterized by low ...