Changes in chaebol firms’ overinvestment after the Asian financial crisis: a long-term perspective

Jaimin Goh, Won W. Choi, Jungeun Cho

Research output: Contribution to journalArticle

3 Citations (Scopus)

Abstract

This paper examines chaebol firms’ overinvestment practices before and after a financial crisis in Korea. In comparison to non-chaebol firms, chaebol firms significantly reduced overinvestment after the Asian financial crisis. Also, chaebol firms were less inclined to engage in earnings management for overinvestment after the financial crisis. The results suggest that governance and financial reforms focusing on chaebol firms and emphasizing long-term firm value after the crisis discouraged chaebol firms’ overinvestment practices, bringing about a sharp rebound in their business performance.

Original languageEnglish
Pages (from-to)75-111
Number of pages37
JournalAsia-Pacific Journal of Accounting and Economics
Volume23
Issue number1
DOIs
Publication statusPublished - 2016 Jan 2

Fingerprint

Asian financial crisis
Overinvestment
Chaebol
Financial crisis
Earnings management
Firm value
Korea
Financial reform
Business performance
Rebound
Governance

All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics and Econometrics

Cite this

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Changes in chaebol firms’ overinvestment after the Asian financial crisis : a long-term perspective. / Goh, Jaimin; Choi, Won W.; Cho, Jungeun.

In: Asia-Pacific Journal of Accounting and Economics, Vol. 23, No. 1, 02.01.2016, p. 75-111.

Research output: Contribution to journalArticle

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