Business group heterogeneity and firm outcomes: Evidence from Korean chaebols
BP2-STS
- Ducret, Romain ORCID Université de Fribourg
- Isakov, Dušan ORCID Université de Fribourg
- 2024
Published in:
- Global Finance Journal. - Elsevier BV. - 2024, p. 101056
English
This study examines how business group heterogeneity affects firm outcomes using data from Korean chaebols (2007–2019). We employ a three-level empirical strategy considering: 1) market-level average effects, 2) effects across categories of business groups, and 3) group-specific effects capturing unobservable attributes. Our analysis reveals substantial variations in affiliation effects between business groups, often diverging from average market-level effects. We find that group resources significantly impact affiliate performance - investors assign higher valuations to firms affiliated with large, financially sound, and well-performing business groups. While performance effects are primarily market-driven, we document considerable heterogeneity in financial and investment policies across groups, likely influenced by unobservable characteristics such as controlling shareholders’ preferences. Our findings highlight the importance of considering business group heterogeneity when analyzing affiliate performance.
- Faculty
- Faculté des sciences économiques et sociales et du management
- Department
- Département des sciences du Management
- Language
-
- English
- Classification
- Economics
- License
- CC BY
- Open access status
- hybrid
- Identifiers
-
- DOI 10.1016/j.gfj.2024.101056
- ISSN 1044-0283
- Persistent URL
- https://folia.unifr.ch/unifr/documents/330176
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