Asia-Pacific Journal of Business (아태비즈니스연구)

KNU The Institute of Management & Economy Research (강원대학교 경영경제연구소)
권호 표지
DOI QR코드

DOI QR Code

Working Conditions and Firm Survival

임직원 근로조건과 기업생존

  • Cho, Seung-Mo (School of Economics and Finance, Yeungnam University)
  • 조승모 (영남대학교 경제금융학부)
  • Received : 2018.11.30
  • Accepted : 2018.12.26
  • Published : 2018.12.30
Download PDF
⟨ Previous Next ⟩

Abstract

This paper empirically analyzes how working conditions of employees and executives affect Korean companies' survival. To this end, a survival analysis based on the accelerated failure time model is conducted from the end of December 2012 to the end of September 2018 on the 2012 year-end financial data for corporations whose common stocks have ever been listed either in the KOSPI market or in the KOSDAQ market with fiscal year ending at the end of December. The analysis shows that the average wage level per employee and the number of executives relative to the number of employees threaten while the average duration of service for female employees prolongs firm survival. Here, the average wage level per employee has turned out to worsen firm survivability regardless of the gender of employees in question while the average duration of service improves firm survivability only in case the employees are female: the average duration of service for male employees or the entire employees has turned out not to have any statistically significant influence on firm survival. The average compensation per executive and the percentage of temporary employees have turned out not to have any statistically significant influence on firm survival while the percentage of female employees has shown statistically significant positive influence on firm survival in some, although not all, models employed in our study. These results are expected to be a good reference in the course of our reaching agreements regarding the improvement of working conditions either between firms and employees or among the members of the entire society.

Keywords

References

  1. Ahn, Se-Yeon (2014), "A Study on the Common Management Practices of Long-Lived Companies: Do they Function as Longevity Routines that Enhance Long-Term Survivability?", Korean Management Review, 43(3), 889-917.
  2. Audretsch, D. B. and T. Mahmood (1995), "New Firm Survival: New Results Using a Hazard Function", The Review of Economics and Statistics, 77(1), 97-103. https://doi.org/10.2307/2109995
  3. Bach, S. B. and A. D. Smith (2007), "Are Powerful CEOs Beneficial to Post-IPO Survival in High Technology Industries?: An Empirical Investigation", The Journal of High Technology Management Research, 18(1), 31-42. https://doi.org/10.1016/j.hitech.2007.03.002
  4. Baldwin, J. R. and M. Rafiquzzaman (1995), "Selection Versus Evolutionary Adaptation: Learning and Post-Entry Performance", International Journal of Industrial Organization, 13(4), 501-522. https://doi.org/10.1016/0167-7187(95)00502-1
  5. Barney, J. B. (1986), "Strategic Factor Markets: Expectations, Luck, and Business Strategy", Management Science, 32(10), 1223-1370. https://doi.org/10.1287/mnsc.32.10.1223
  6. Barney, J. B. (1997), Gaining and Sustaining Competitive Advantage, Massachusetts: Addison-Wesley Publishing Company.
  7. Beveren, I. V. (2007), "Footloose Multinationals in Belgium?", Review of World Economics, 143(3), 483-507. https://doi.org/10.1007/s10290-007-0118-8
  8. Brocheler, V., S. Maijoor, A. van Witteloostuijn (2004), "Auditor Human Capital and Audit Firm Survival: The Dutch Audit Industry in 1930-1992", Accounting, Organizations and Society, 29(7), 627-646. https://doi.org/10.1016/j.aos.2003.10.008
  9. Cefis, E. and O. Marsili (2005), "A Matter of Life and Death: Innovation and Firm Survival", Industrial and Corporate Change, 14(6), 1167-1192. https://doi.org/10.1093/icc/dth081
  10. Chang, Sea-Jin (1998), "A Survey on the Resource-Based and the Evolutionary Approaches to Strategic Theories of the Firm", Journal of Strategic Management, 1(1), 49-73.
  11. Cho, Dong-Hun (2016), "Determinants of Female-salaried Workers' Career Interruption", Korean Journal of Labor Economics, 39(4), 81-100.
  12. Cho, Seung-Mo (2010a), "Corporate Governance and Firm Survival: Evidence from Korea", Journal of Finance & Knowledge Studies, 8(3), 63-101.
  13. Cho, Seung-Mo (2010b), Essays on Behavioral Asset Pricing and Corporate Finance, (Unpublished Doctoral Dissertation), Seoul: Korea University.
  14. Cho, Seung-Mo (2013), "A Model on Credit Analysis: Combining A First Passage Model and Survival Analysis for Corporate Default", Financial Stability Studies, 14(1), 109-159.
  15. Cho, Seung-Mo (2016a), "A Study on Persistency of Neo-Luddism through Firm Survival Analysis: Evidence from Listed ICT Manufacturing Corporations in Korea", The Journal of Humanities and Social Science, 7(1), 689-708.
  16. Cho, Seung-Mo (2016b), "Impacts of R&D, Intangible Assets, and Ownership Concentration on Corporate Survival: Evidence from Listed Korean Manufacturing SMEs", Institute for Humanities and Social Sciences, 17(1), 635-660. https://doi.org/10.15818/ihss.2016.17.1.635
  17. Cho, Seung-Mo (2016c), "Marketing Activities and Firm Survival in the Knowledge and Information Era: Evidence from Korean Listed Manufacturing Corporations", Institute for Humanities and Social Sciences, 17(2), 329-351. https://doi.org/10.15818/ihss.2016.17.2.329
  18. Cleves, M. A., W. W. Gould, R. G. Gutierrez, and Y. U. Marchenko (2008), An Introduction to Survival Analysis Using Stata (2nd ed.), Texas: Stata Press.
  19. Cox, D. R. (1972), "Regression Models and Life-Tables", Journal of the Royal Statistical Society. Series B (Methodological), 34(2), 187-220. https://doi.org/10.1111/j.2517-6161.1972.tb00899.x
  20. Cox, D. R. (1975), "Partial Likelihood", Biometrika, 62(2), 269-276. https://doi.org/10.1093/biomet/62.2.269
  21. Das, S. and K. Srinivasan (1997), "Duration of Firms in an Infant Industry: The Case of Indian Computer Hardware", Journal of Development Economics, 53(1), 157-167. https://doi.org/10.1016/S0304-3878(97)00007-2
  22. Dierickx, I. and K. Cool (1989), "Asset Stock Accumulation and Sustainability of Competitive Advantage", Management Science, 35(12), 1504-1511. https://doi.org/10.1287/mnsc.35.12.1504
  23. Hensler, D. A., R. C. Rutherford, and T. M. Springer (1997), "The Survival of Initial Public Offerings in the Aftermarket", The Journal of Financial Research, 20(1), 93-110. https://doi.org/10.1111/j.1475-6803.1997.tb00238.x
  24. Hiatt, S. R. and W. D. Sine (2014), "Clear and Present Danger: Planning and New Venture Survival amid Political and Civil Violence", Strategic Management Journal, 35(5), 773-785. https://doi.org/10.1002/smj.2113
  25. Jung, Su-Yeon (2000), Return to Scale, Total Factors Productivity, Duration Analysis of Korea Listing Companies, (Unpublished Doctoral Dissertation), Seoul: Chung-Ang University.
  26. Kalbfleisch, J. D. and R. L. Prentice (1980), The Statistical Analysis of Failure Time Data, New York: John Wiley and Sons, Inc.
  27. Kang, Mi and Jae-Woo Lee (2009), "Survival Analysis of Small and Medium Size Construction Enterprises Using Cox Proportional Hazards Model", Journal of the Korea Real Estate Analysts Association, 15(2), 41-57.
  28. Kim, Kyung-Sook, Young-Ho Do, and Young-Min Jang (2014), "A Study on the Survival Factors of Start-up SMEs Using Hazard Model by Industry", Korean Management Review, 43(1), 121-144.
  29. Kleinbaum, D. G. and M. Klein (2005), Survival Analysis: A Self-Learning Text (2nd ed.), New York: Springer Science+Business Media, Inc.
  30. Kwon, Ki-Wook and Hyo-Sang Ryou (2014), "Asian Financial Crisis, Human Capital Investment, Firm Performance and Survival", Journal of Organization and Management, 38(3), 69-93.
  31. Lee, Jin-Kyung and Sun-Wha Ok (2009), "Young Married Women's Labor Market Exit: Focused on the Effects of the Child Birth and Available Family-Friendly Policies", Survey Research, 10(3), 59-83.
  32. Martinussen, T. and T. H. Scheike (2006), Dynamic Regression Models for Survival Data, New York: Springer Science+Business Media, Inc.
  33. McCloughan, P. and I. Stone (1998), "Life Duration of Foreign Multinational Subsidiaries: Evidence from UK Northern Manufacturing Industry 1970-93", International Journal of Industrial Organization, 16(6), 719-747. https://doi.org/10.1016/S0167-7187(97)00070-2
  34. Meeus, M. T. H. and L. A. G. Oerlemans (2000), "Firm Behaviour and Innovative Performance: An Empirical Exploration of the Selection-Adaptation Debate", Research Policy, 29(1), 41-58. https://doi.org/10.1016/S0048-7333(99)00032-3
  35. Nelson, R. R. and S. G. Winter (1982), An Evolutionary Theory of Economic Change, Massachusetts: The Belknap Press of Harvard University Press.
  36. Parker, S., G. F. Peters, and H. F. Turetsky (2002), "Corporate Governance and Corporate Failure: A Survival Analysis", Corporate Governance: The International Journal of Business in Society, 2(2), 4-12. https://doi.org/10.1108/14720700210430298
  37. Pennings, J. M., K. Lee, and A. van Witteloostuijn (1998), "Human Capital, Social Capital, and Firm Dissolution", The Academy of Management Journal, 41(4), 425-440. https://doi.org/10.2307/257082
  38. Penrose, E. T. (1959), The Theory of the Growth of the Firm, New York: John Wiley and Sons, Inc.
  39. Prahalad, C. K. and G. Hamel (1990), "The Core Competence of the Corporation", Harvard Business Review, 68(3), 79-91.
  40. Schoenfeld, D. (1980), "Chi-Squared Goodness-of-Fit Tests for the Proportional Hazards Regression Model", Biometrika, 67(1), 145-153. https://doi.org/10.1093/biomet/67.1.145
  41. StataCorp LP (2011), Stata Survival Analysis and Epidemiological Tables Reference Manual (Release 12), Texas: Stata Press.
  42. Vittinghoff, E., D. V. Glidden, S. C. Shiboski, and C. E. McCulloch (2005), Regression Methods in Biostatistics: Linear, Logistic, Survival, and Repeated Measures Models, New York: Springer Science+Business Media, Inc.
  43. Welbourne, T. M. and A. O. Andrews (1996), "Predicting the Performance of Initial Public Offerings: Should Human Resource Management Be in the Equation?", The Academy of Management Journal, 39(4), 891-919. https://doi.org/10.5465/256716
  44. Wernerfelt, B. (1984), "A Resource-Based View of the Firm", Strategic Management Journal, 5(2), 171-180. https://doi.org/10.1002/smj.4250050207
  45. Yang, C.-Y. and H.-J. Sheu (2006), "Managerial Ownership Structure and IPO Survivability", Journal of Management and Governance, 10(1), 59-75. https://doi.org/10.1007/s10997-005-3552-9