Internal Capital Markets in Business Groups: Evidence from the Asian Financial Crisis

• 成果类型: Article
• 署名作者: Almeida, Heitor; Kim, Chang-Soo; Kim, Hwanki Brian
• 署名单位: Yonsei University; University of Illinois System; University of Illinois Urbana-Champaign
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/jofi.12309
• 发表日期: 2015
• 页码: 2539-2586
• 关键词: CORPORATE GOVERNANCE; matching estimators; Emerging markets; entrenchment; INVESTMENT; OWNERSHIP; COSTS; FIRMS

摘要

This paper examines capital reallocation among firms in Korean business groups (chaebol) in the aftermath of the 1997 Asian financial crisis, and the consequences of this capital reallocation for the investment and performance of chaebol firms. We show that chaebol transferred cash from low-growth to high-growth member firms, using cross-firm equity investments. This capital reallocation allowed chaebol firms with greater investment opportunities to invest more than control firms after the crisis. These firms also showed higher profitability and lower declines in valuation than control firms following the crisis. Our results suggest that chaebol internal capital markets helped them mitigate the negative effects of the Asian crisis on investment and performance.