Economic policy uncertainty and overinvestment: evidence from Korea

Autor:	Wenwen Jiang, Hwa-Sung Kim
Jazyk:	angličtina
Rok vydání:	2021
Předmět:	economic policy uncertainty overinvestment free cash flow chaebol d81 g18 g31 g41 Finance HG1-9999 Risk in industry. Risk management HD61
Zdroj:	Seonmul yeongu, Vol 29, Iss 4, Pp 301-318 (2021)
Druh dokumentu:	article
ISSN:	1229-988X 2713-6647
DOI:	10.1108/JDQS-05-2021-0010/full/pdf?title=economic-policy-uncertainty-and-overinvestment-evidence-from-korea
Popis:	The authors show that there is a negative relationship between economic policy uncertainty (EPU) and firm overinvestment using Korean data from 2007 to 2016. Since Jensen (1986) shows that a firm's free cash flow is an important factor of overinvestment, the authors examine how free cash flow influences the sensitivity of overinvestment to EPU. The authors find that a high level of free cash flow attenuates the negative effect of EPU on overinvestment. The authors find that there is no significant difference in the effect of EPU on overinvestment between Chaebol (Korean family-run conglomerates) and non-Chaebol firms, which is consistent with the literature that the features of Chaebol are weakening.
Databáze:	Directory of Open Access Journals
Externí odkaz:	https://doaj.org/article/070395673a444bf1952f5457165376ab Zobrazit plný text záznamu View record in DOAJ