Manuscript type: Research paper Research aims: This study investigates the effects of financing resources on firm performance and efficiency among the SMEs of Korea. It also examines the relevance of various factors between the sources of financing and corporate performance and efficiency. Design/Methodology/Approach: Data taken for empirical analysis are those from 2011 to 2016. Samples are taken from the Korea Composite Stock Price Index (KOSPI) and Korea Securities Dealers Association (KOSDAQ) companies listed on the Korea Exchange. To examine the relationship between financing resources and firm performances, we employ a structural equation model (path model) derived from AMOS 24 of the SPSS. Research findings: Results show that SME's internal finance and institutional finance have a positive effect on firm performance but other capitals have a negative effect on firm performance. Internal finance and corporate credit contribute to better efficiency whereas institutional finance has a significant negative impact on efficiency. These findings suggest that there are differences between financing resources and firm performance. Results also show that institutional finance has a negative impact on growth while other capitals have a positive effect on growth. Theoretical contribution/Originality: This study is unlike past studies; it examines the impact of financing sources on performance.
The purpose of this paper is to examine the relationship power distribution among several blockholders (contestability) and firm performance. We use a sample of 646 firms listed in the security markets of Korea from 2005 to 2007. Using different measures of contestability, we verify advance research literature by examining that, when power dispersion among several blockholders (contestability) increases, firm performance is enhanced. The results show that, when the possibility of a controlling coalition being formed among several blocks increases, the corporate value decreases. We also find that this relationship is even more significant in KOSDAQ. However, the smaller the competition of voting rights among blockholders, the higher the corporate performance in KOSPI. The reason for this seems to be that the two markets are different in terms of ownership and governance. This suggests that the effects of contestability among blockholders on firm performance depend on the type of the stock market. The results of this study expand the existing governance literature by analyzing the relationship between contestability among blockholders and firm performance in emerging markets such as Korea. Our findings contribute to policymakers and investors who are interested in the relationship between contestability of control and firm performance in the Korea stock market.
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