• Journal of International Area Studies (JIAS)
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• v.14 no.2
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• pp.499-524
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• 2010

The purpose of this study is to based on review of theoretical and empirical studies to assess the independence of central banks - the former Socialist republics, including the Russian Federation and Czech, Poland. In addition, the work is expected to clarify whether a link exists between independence and the most important economic indicators such as inflation, economic activity, the budget deficit. And The subject of this study are the formal and actual independence of national banks, as well as limiting factors: political and economic. Background investigation of the problem of independence of central banks from the fact that, according to many economists, it is essential to the successful development of a market economy. The effectiveness of any country's economy due to currency volatility, low inflation, high reliability of the banking system, etc. As far as the independence of monetary regulation contributes to these goals - one of the most actively debated issues in the world of economic theory and practice for a long time. The issue of central bank independence is extremely important for Russia, Czech, Poland. In the near future to the central bank has important tasks, among which are the transition to inflation targeting in the rejection of significant intervention in the foreign exchange market, as well as improving the sustainability of the national banking system. Transparency and independence of the Bank of Russia, Czech Republic, Poland, in my view, should be an important factor in achieving these goals. The countries of Czech Republic, Poland have already made a number of steps to bring the status of their banks to the European standards. Many other developing countries are also in the process of reforming their central banks and the improving conditions of their functioning. However, despite the fact that as a model for reform used by the central banks of countries with developed market economies, central banks in developing countries are still yet deprived of the legal, economic and political independence. A different situation exists in transition space. Because of significant differences in the views of the authorities in transition republics at the necessary level of independence of central banks and the exchange rate and monetary policy reform of monetary management in these countries led to different results.

• KDI Journal of Economic Policy
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• v.31 no.1
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• pp.169-206
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• 2009

This study stems from a question, "How should we understand the pattern of the Korean economy after the 1990s?" Among various analytic methods applicable, this study chooses a Structural Vector Autoregression (SVAR) with long-run restrictions, identifies diverse impacts that gave rise to the current status of the Korean economy, and differentiates relative contributions of those impacts. To that end, SVAR is applied to four economic models; Blanchard and Quah (1989)'s 2-variable model, its 3-variable extensions, and the two other New Keynesian type linear models modified from Stock and Watson (2002). Especially, the latter two models are devised to reflect the recent transitions in the determination of foreign exchange rate (from a fixed rate regime to a flexible rate one) as well as the monetary policy rule (from aggregate targeting to inflation targeting). When organizing the assumed results in the form of impulse response and forecasting error variance decomposition, two common denominators are found as follows. First, changes in the rate of economic growth are mainly attributable to the impact on productivity, and such trend has grown strong since the 2000s, which indicates that Korea's economic growth since the 2000s has been closely associated with its potential growth rate. Second, the magnitude or consistency of impact responses tends to have subsided since the 2000s. Given Korea's high dependence on trade, it is possible that low interest rates, low inflation, steady growth, and the economic emergence of China as a world player have helped secure capital and demand for export and import, which therefore might reduced the impact of each sector on overall economic status. Despite the fact that a diverse mixture of models and impacts has been used for analysis, always two common findings are observed in the result. Therefore, it can be concluded that the decreased rate of economic growth of Korea since 2000 appears to be on the same track as the decrease in Korea's potential growth rate. The contents of this paper are constructed as follows: The second section observes the recent trend of the economic development of Korea and related Korean articles, which might help in clearly defining the scope and analytic methodology of this study. The third section provides an analysis model to be used in this study, which is Structural VAR as mentioned above. Variables used, estimation equations, and identification conditions of impacts are explained. The fourth section reports estimation results derived by the previously introduced model, and the fifth section concludes.

• KDI Journal of Economic Policy
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• v.27 no.1
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• pp.1-38
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• 2005

Our paper aims to estimate a household consumption function in the presence of liquidity constraints as well as household characteristics. Empirical findings from a Korean cross-sectional data (National Survey of Household Income and Expenditure) reveal that several family characteristics, such as household size, number of working members, children in school, and educational level and age of the household head, turn out to be critical determinants of household consumption. Especially, the influence of household size on consumption decision is shown to be highly significant, not only indirectly through its impact on household income, but also directly by affecting the household's preference for consumption itself. While, the other family characteristics primarily influences household income. Our paper distinguishes itself from existing literature in that it greatly improves the explanatory power of the estimated household consumption function by measuring the degree of the liquidity constraint rather than simply identifying its presence. Based on the assumption that the present value of human capital is a function of household characteristics, the degree of the liquidity constraint is represented by the underestimated portion of the human capital. Such a method of implementing the liquidity constraint is useful in treating various types of assets according to their liquidity. Finally, our estimated household consumption function is applied to decompose cross-sectional variances of consumption inequality. The analysis confirms that the overall alleviation in liquidity constraints in Korea after the 1997 currency crisis reduced consumption inequality despite the worsening of income inequality and changes in the demographic composition of family characteristics during the same period.

• Information Systems Review
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• v.10 no.2
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• pp.159-177
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• 2008

Since the IMF crisis, the competition among banks in Korea has fiercely intensified. To survive in the severe competition, several leading banks including Industrial Bank of Korea (IBK) have recently developed their own proprietary systems called 'the Next-Generation Systems(NGS).' This case study was to answer several important issues as follows; 1); the reason why a bank make huge investment in the IT infrastructure; 2) the development methodology of the NGS; 3) the new architecture of the NGS; 4) the governance structure of the NGS investment; and 5) the effects of the NGS on the development of new products. To achieve such goals, a systematic tandem interview method and many archival reports from IBK were utilized. The conclusions are summarized as follows: First, the NGS has contributed to the integration and simplification of business processes. Second, new products as demanded in the market can be developed much faster through the NGS. Third, the change management of IT infrastructure is critically important. Fourth, the systems architecture can be different according to the IT governance. Fifth, the alignment of the NGS and business processes is most important to obtain the organizational goals.

• International Commerce and Information Review
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• v.19 no.4
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• pp.95-124
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• 2017

The dispute analysed in this article concern eight measures taken by Argentina regarding finance, taxation, foreign exchange, and registration. The dispute centered on whether these measures were in violation of the Member's obligations under the General Agreement on Trade in Services (GATS), namely most-favored national treatment, national treatment and market access, and whether they are justified by Article XIV and Article 2(a) of the Annex on Financial Services. Important arguments raised in the dispute include whether the services and the service providers of cooperative and non-cooperative countries and/or Argentina subjected to the measures are like for the purposes of Article II and Article XVII of the GATS, whether the regulatory aspects of the measures are to be considered in determining the inconsistency with Article II and Article XVII of the GATS, and whether the measures are justified in that they were taken in accordance with the national laws and regulations aimed at implementing the Global Forum on Transparency and Exchange of Information for Tax Purposes and the Financial Action Task Force. The essence of this dispute lies in the balance of each Member's right to regulate commercial and/or financial activities and its obligations under the GATS. The Appellate Body tried to strike such a balance in its assessment of: (i) likeness of services and service suppliers, (ii) no less favorable treatment under Articles II and XVII, and (iii) the scope of measures under Article 2(a) of the Annex on Financial Services. This article aims to provide an analysis of the Appellate Body's findings, giving light to the relevant jurisprudence and scholars' writings.

• The Korean Journal of Financial Management
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• v.26 no.1
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• pp.1-29
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• 2009

As foreign investors' share holdings in Korean firms have dramatically increased since 1998 following the financial deregulation on the limit of foreign stock investment, the concern over the negative impacts the foreign investors would bring on the firms' financial policy has been growing too. Foreign investors were perceived to require the firms of excessive payments of cash dividends sometimes with threat of hostile takeover trials detering the firm from investing its cash flow in the physical facilities and RandD eroding their potential growth capabilities. We examine the impact of foreign investment on the firms' dividend policy using 234 listed firms' panel data over the sample periods of 1998 to 2005 employing various panel regression methodology. Foreign shareholders are found not to be related or even negatively related to the payout ratio(dividend/net income), but positively and statistically significantly related to the ratio of cash dividends to book of asset, negatively to the dividend yields. Considering the payout ratio is the most appropriate measure for the dividend payment, we can not support the arguments that the foreign investors' holdings have induced the excessive dividend level in Korean firms.

• Journal of Distribution Research
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• v.15 no.5
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• pp.37-60
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• 2010

Department Stores have been in place as typical large-scale retailer in Korean retail market. After Asian financial crisis in 1997, the market share of major three department stores has been increased and they have had a dominant position in relationship with vendors or manufacturers. Thus, they are able to control sales commission. Sales commission is defined as things that department stores which contribute to products sales instead of manufacturers take some portion of price as their revenue. In other words, vendors or manufacturers pay some amount of money from their sales by contracted ratio to department stores. The problem is that vendors or manufacturers think that sales commission is high. However, department stores have a different opinion that sales commission is not high because they generate new value from gathering customers and doing marketing activity on behalf of vendors or manufacturers. Because department stores have operated with business model of renting sales space to vendors or manufacturers instead of buying goods directly from them, this situation has been taken place. The revenue of department stores depend on sales commission. Thus, they want to get a dominant power to control sales commission in relationship with vendors or manufacturers. So, they have tried to increase their size and brand power. The considered policies related in sales commission of department stores are as following: preventing monopoly or oligopoly of department store, being strength of monitoring for department stores' unfair trade, strict enforcement of law for large-scale retailer's unfair trade, and inducing win-win strategy doing voluntarily by department stores.

• Journal of Labour Economics
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• v.30 no.3
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• pp.43-75
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• 2007

This study reviews the trend of job separation rates for three years from 2002 to 2005 and investigates the various elements which influence this trend, especially the role of the labor unions, by using Korean Labor Panel data. In the basic statistics, the job retention rate of union members were higher by an average of 28.3% points compared to non-union members, but in the results of controlling the observed variables of individual influences in changing jobs, it was estimated that unions increase the job retention rate by 11% to 13% points. To investigate the effect of unions on the job stability of workers in detail, the non-linear decomposition method developed by Fairlie (2003) was used in the analysis. In examining the difference of job separation rates between union members and non-union members through observed variables of workers in explainable parts and unexplainable parts by using the non-linear decomposition technique, the contribution of the explainable part was estimated to be 67% to 74% and the unexplainable part accounted for the rest which was 26% to 33%. This suggests that not only does the union contribute to the job stability of its members, but the propensity to change jobs for a worker who is a union member is on average lower than that of a worker who is not a union member or who works at an establishment that does not have a union. The results of the empirical analysis show that the job stability effect of labor unions is limited within the boundary of a maximum 7% to 9% points. The reason for the effect of labor unions on job stability being so low is due to various reasons such as collective bargaining structure by company, intensified business competition after the financial crisis, and labor market segmentation.

• Journal of the Korean Geographical Society
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• v.51 no.3
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• pp.401-420
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• 2016

This study aims to investigate the changes in the occupational structure of employment in Korea during the last three decades, in which have transformed from industrialized economy to knowledge-based economy very rapidly as well as having experiences of both IMF and financial crisis. For this purpose, we analyze the trends occupational distribution and the socio-demographic characteristics of the occupational structure of employment since 1980. By applying correspondence analysis of Multidimensional Scaling(MDS) methods, we examine the inter-relationships between the employed persons by occupation and their characteristics such as gender, age group, educational attainment, industry, region. We found the occupational structure of Korea has been changed dramatically with the socio-economic transformations during the last four decades. In particular, the occupational (job) structure has been highered in general. However, it has also been dualized extremely into two groups, one is the specialized-skilled-white color jobs and the other is the simple-unskilled-blue color jobs. The results of this study could be utilized as the importation basis for the provision of labour supply and employment policy plan at the national level as well as at the local level.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.12 no.2
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• pp.699-711
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• 2011

This study is to perform several major analyses to find any differences in the leverage between the pre- and post-period of the currency crisis. Moreover, another aspect is to investigate a financial aspect which has received relatively little attention to the firms and/or industries in the emerging capital markets in comparison to those in the advanced markets. The purpose of this empirical study is to confirm whether or not, it is myth or reality that Korean business conglomerate, chaebol, firms with subsidized financing from government-owned domestic financial institutions in the pre-financial turmoil, may still maintain their higher leverage, even after the crisis. It was found that firms belonging to the chaebol in Korea maintained higher average book-value and market-value based debt ratios, relative to their counterparts not belonging to the chaebol across all of the tested models. There were positive relationships of IND3(=the chemical industry) and Ind5(=the construction industry) to the book-value leverage. This study identified that there were no differences in the explanatory variables included, between the tested models (that is, without and with including the present value of an operating lease) related to each debt ratio. Since the Korean government continue to improve the corporate governance of the domestic firms in terms of accounting transparency and corporate ownership, it would be more efficient, if utilizing this "new" ratio considering an operating lease as an effective measurement of the level of leverage. In terms of the capital structure, it may also be possible for foreign firms to utilize and benefit from the results obtained in this study when operating their new businesses in Korea, given the economic circumstances such as the ongoing progress of the Korea-America FTA or the Korea-China FTA.