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Business Groups in Thailand: Before and after the East Asian Financial Crisis

Author

Listed:
  • Polsiri, Piruna
  • Wiwattanakantang, Yupana

Abstract

This paper investigates how business groups in Thailand had evolved since the 1950s. We argue that political connections and foreign capital among other factors were contributable to the emerging of Thai business groups. The business groups that owned banks developed fast during the late 1980s and the early 1990s until the financial deregulation, and the establishment of the Stock Exchange of Thailand, and the Bangkok International Banking Facilities. After that the groups that do not own banks have expanded rapidly. We find that the ownership and board structure of the listed firms that belong to the top 30 business groups were not affected by the crisis. Compared to the pre-crisis period, the leverage ratio for the business groups firms has increased while the profitability has declined during the post crisis of 1997-1999. Restructuring appears to work well among group firms since it has helped improved industry-adjusted operating performance of the firms.

Suggested Citation

  • Polsiri, Piruna & Wiwattanakantang, Yupana, 2004. "Business Groups in Thailand: Before and after the East Asian Financial Crisis," CEI Working Paper Series 2004-13, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
  • Handle: RePEc:hit:hitcei:2004-13
    as

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    File URL: http://hermes-ir.lib.hit-u.ac.jp/rs/bitstream/10086/13875/1/wp2004-13a.pdf
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    References listed on IDEAS

    as
    1. Wiwattanakantang, Yupana, 2001. "The Equity Ownership Structure of Thai Firms," CEI Working Paper Series 2001-8, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    2. Khanthavit, Anya & Polsiri, Piruna & Wiwattanakantang, Yupana, 2003. "Did Families Lose or Gain Control after the East Asian Financial Crisis?," CEI Working Paper Series 2003-1, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Business Group; Corporate Governance; Ownership Structure; Restructuring; East Asian Financial Crisis;

    JEL classification:

    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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