IDEAS home Printed from https://ideas.repec.org/p/hhs/eijswp/0122.html
   My bibliography  Save this paper

Insolvency in the Corporate Sector and Financial Crisis in Korea

Author

Listed:
  • Kim, Joon-Kyung

    (Korea Development Institute and University of Hawaii at Manoa)

  • Lee, Chung H.

    (European Institute of Japanese Studies)

Abstract

The paper shows that between the late 1980s and 1997, the year when Korea was engulfed in a financial crisis, its corporate-sector profitability was on a decreasing trend, albeit short-term ups and downs. The evidence presented in the paper suggests that Korea’s corporate and financial sectors had been highly vulnerable to a crisis for some years before 1997 and the actual timing of the crisis was triggered by the financial crisis in Thailand in July 1997 and its contagion effect.

Suggested Citation

  • Kim, Joon-Kyung & Lee, Chung H., 2001. "Insolvency in the Corporate Sector and Financial Crisis in Korea," EIJS Working Paper Series 122, Stockholm School of Economics, The European Institute of Japanese Studies.
    • Handle: RePEc:hhs:eijswp:0122
    as

    Download full text from publisher

    File URL: http://swopec.hhs.se/eijswp/papers/eijswp0122.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Chung H Lee & Keun Lee & Kangkoo Lee, 2000. "Chaebol, Financial Liberalization, and Economic Crisis: Transformation of Quasi-Internal Organization in Korea," Working Papers 200004, University of Hawaii at Manoa, Department of Economics.
    2. Harberger, Arnold C, 1985. "Observations on the Chilean Economy, 1973-1983," Economic Development and Cultural Change, University of Chicago Press, vol. 33(3), pages 451-462, April.
    3. Chung H Lee & Keun Lee & Kangkoo Lee, 2000. "Chaebol, Financial Liberalization, and Economic Crisis: Transformation of Quasi-Internal Organization in Korea," Working Papers 200004, University of Hawaii at Manoa, Department of Economics.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Driffield, Nigel & Pal, Sarmistha, 2006. "Do external funds yield lower returns?: Recent evidence from East Asian economies," Journal of Asian Economics, Elsevier, vol. 17(1), pages 171-188, February.
    2. Ahn, JaeBin & Choi, Moon Jung, 2020. "From firm-level imports to aggregate productivity: Evidence from Korean manufacturing firm data," Japan and the World Economy, Elsevier, vol. 56(C).
    3. Kaiji Chen & Alfonso Irarrazabal, 2015. "The Role of Allocative Efficiency in a Decade of Recovery," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 18(3), pages 523-550, July.
    4. Maloney, William F., 1997. "Testing capital account liberalization without forward rates Another look at Chile 1979-1982," Journal of Development Economics, Elsevier, vol. 52(1), pages 139-168, February.
    5. Vittorio Corbo & Stanley Fischer, "undated". "Lessons from the Chilean Stabilization and Recovery," Documentos de Trabajo 158, Instituto de Economia. Pontificia Universidad Católica de Chile..
    6. Kim, Euysung, 2006. "The impact of family ownership and capital structures on productivity performance of Korean manufacturing firms: Corporate governance and the "chaebol problem"," Journal of the Japanese and International Economies, Elsevier, vol. 20(2), pages 209-233, June.
    7. Alberto Chong & Luisa Zanforlin, 2004. "Inward-Looking Policies, Institutions, Autocrats, and Economic Growth in Latin America: An Empirical Exploration," Public Choice, Springer, vol. 121(3), pages 335-361, February.
    8. Sebastian Edwards, 1995. "Trade Policy, Exchange Rates, and Growth," NBER Chapters, in: Reform, Recovery, and Growth: Latin America and the Middle East, pages 13-52, National Bureau of Economic Research, Inc.
    9. Jeon, Bang Nam, 2012. "From the 1997-98 Asian financial crisis to the 2008-09 global economic crisis: lessons from Korea’s experience," MPRA Paper 36469, University Library of Munich, Germany.
    10. Tarun Khanna & Yishay Yafeh, 2007. "Business Groups in Emerging Markets: Paragons or Parasites?," Journal of Economic Literature, American Economic Association, vol. 45(2), pages 331-372, June.
    11. Chung Lee, 2005. "The Political Economy of Institutional Reform in Korea," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 10(3), pages 257-277.
    12. Jiyoung Kim, 2017. "Corporate financial structure of South Korea after Asian financial crisis: the chaebol experience," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 6(1), pages 1-14, December.
    13. Lee, Keonbeom & Peng, Mike W. & Lee, Keun, 2008. "From diversification premium to diversification discount during institutional transitions," Journal of World Business, Elsevier, vol. 43(1), pages 47-65, January.
    14. Sebastián Edwards, 2005. "Managing the Capital Account," Working Papers Central Bank of Chile 338, Central Bank of Chile.
    15. Rudger Dornbusch & Ilan Goldfajn & Rodrigo O. Valdés, 1995. "Currency Crises and Collapses," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(2), pages 219-294.
    16. Kaiji Chen & Alfonso Irarrazabal, 2015. "The Role of Allocative Efficiency in a Decade of Recovery," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 18(3), pages 523-550, July.
    17. Salazar-Xirinachs, José Manuel, 1990. "Present and future integration in Central America," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    18. Sebastian Edwards, 1994. "Macroeconomic Stabilization in Latin America: Recent Experience and Some Sequencing Issues," NBER Working Papers 4697, National Bureau of Economic Research, Inc.
    19. Carlos Cáceres, 1987. "Garantía Oficial Implícita y Créditos Externos," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 24(72), pages 127-142.
    20. Dong-Hwan Kim & Jesse Campbell, 2015. "Development, Diversification, and Legitimacy: Emergence of the Committee-Based Administrative Model in South Korea," Public Organization Review, Springer, vol. 15(4), pages 551-564, December.

    More about this item

    Keywords

    Asian crisis; Korean economy; corporate sector insolvency.;
    All these keywords.

    JEL classification:

    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hhs:eijswp:0122. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Nanhee Lee (email available below). General contact details of provider: https://edirc.repec.org/data/eihhsse.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.