• 산경연구논집
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• 제8권1호
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• pp.33-39
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• 2017

Purpose - The main purpose of the current study is to examine the impact of accounting information quality and information asymmetry on the underinvestment phenomenon among the listed companies on the Tehran Stock Exchange (TSE). Research design, data, and methodology - The population includes 94 firms selected through systematic sampling. The data is collected from the audited financial statements of the firms provided by TSE's website from 2010 to 2015. Accounting information quality and information asymmetry is considered as independent variables, and their impact is examined on the dependent variable (underinvestment). Results - The statistical results, based on data collected from 94 listed companies on the TSE during 2010-2015, revealed positive impact of accounting information quality and positive impact of information asymmetry on underinvestment. There was a significant relationship between accrual quality (AQ) and underinvestment, and spread and underinvestment. The results also showed that information asymmetry is the main factor in the creation underinvestment. Conclusions - Findings of this article can assist accounting researchers and theoreticians in comparing Real world facts with hypotheses developed with respect to accounting information quality, information asymmetry and underinvestment. However, the results of fuzzy regression analysis indicate significant relationships between the independent variable except underinvestment.

• Journal of Korea Trade
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• 제27권1호
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• pp.60-78
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• 2023

Purpose - The study analyzed 90 online firms worldwise and observed them for ten years to investigate their investments and firm performance variabilities. This study attemped to verify the existence of agency problems in online firms. Through this, the paper intends to expand the scope of research in the fields of investment and firm value both empirically and in theory. This study also attempted to supplement the insufficient logic of previous studies by analyzing the relationship between investment and profitability. Design/methodology - In this study, the investment is subdivided into over-, under-, and neutral investments, and an empirical analysis of the firm performance was conducted. As investment generally has long-term effects, the impact of a firm's investment on future firm performance and variabilities in firm performance was considered over the short-and medium-term period. Findings - It was found that there was a negative relationship between firms with an overinvestment and future firm performance. Underinvestment has no clear statistically significant results on firm performance. This implies that overinvestment causes more reduction in future firm performance than underinvestment. It was also found that underinvestment and overinvestment significantly increased the variability of firm performance. A positive significance was found between under- and over- investment with a variability of 3 years and overinvestment with a variability of 4 years in the future. A negative relationship was found between neutral investment propensity and future performance variabilities. Neutral investment has less effect on the future performance variability of a firm than a firm's overinvestment and underinvestment. For online firms, underinvestment and overinvestment have a greater effect on the firm's future performance variability than neutral investment. Originality/value - The agency theory predicts that information asymmetry and adverse selection problems exacerbate conflicts of interest among stakeholders, thus firm performance. The study contributed to accumulating research on online firms that are currently underexplored by analyzing the investment behavior of major firms in the online industry.

• The Journal of Asian Finance, Economics and Business
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• 제8권1호
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• pp.169-178
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• 2021

This research aims to test, firstly, how the disclosure of corporate social responsibility (CSR) helps to moderate the effect of family ownership on investment efficiency; secondly, how CSR disclosures mediate the effect of corporate governance on investment efficiency. STATA was used to analyze archival data collected from a total sample of 210 manufacturing companies listed on the Indonesian Stock Exchange (IDX), which were in the family businesses category for the period of 2016-2018. The first finding is that CSR moderates the effect of family ownership on investment efficiency. This implies that family businesses are very careful about investing. They will avoid risky decisions that may increase the economic wealth, but reduce the socio-emotional wealth. To maintain socio-emotional wealth, they tend to choose an underinvestment strategy and are more concerned with the prestige and good reputation of their families and dynasties than with economic wealth. Thus, CSR disclosures can reduce the underinvestment strategy of family businesses listed on the IDX. The second finding is that CSR disclosures are able to mediate the effect of corporate governance on investment efficiency. CSR activities play a major role in decision-making, and through CSR disclosures, corporate governance has a greater effect on investment efficiency.

• 재무관리논총
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• 제2권1호
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• pp.189-214
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• 1995

We examine the existence of the investment signaling equilibrium without assuming a specific utility function for the managers of the corporations. We assume the managers have the initial holdings of their own corporations as a form of the executive compensation. Under the different financing schemes to finance the investment, the new equity financing and the risky debt financing, we derive the investment signaling equilibrium and compare the the investment signaling equilibrium under each financing scheme. We show that the investment signaling equilibrium with each financing will obtain with the underinvestment of the high quality firm and that the investment signaling equilibrium with the risky debt financing will dominate the investment signaling equilibrium with the new equity financing.

• ETRI Journal
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• 제36권3호
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• pp.490-497
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• 2014

The market performance of WiBro in Korea has not been as expected, and its rapid diffusion in the near future is unlikely owing to the existence of competing services. There has been little research on the factors affecting this low market diffusion. This study is based on an analytical framework in which a lack of service capability and the insufficiency of service-related activities have resulted in the current poor market performance. An expert survey was conducted on WiBro specialists and verified using the analytical hierarchy process method. The result of this analysis is as follows: underinvestment in network deployment and marketing, insufficient promotional policies, and a shortage of service capabilities are to be analyzed as the main causes of WiBro's low market diffusion.

• 한국IT서비스학회지
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• 제12권2호
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• pp.185-193
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• 2013

This paper analyzes the effects of i-PIN focusing on the positive value creation rather than the negative loss reduction from the viewpoint of internet company. Empirical tests are run to examine what determines the use of i-PIN and whether i-PIN users participate in e-commerce, communication, and SNS activity. Our findings are as follows. First, the reason for using i-PIN lies in the experience of privacy infringement rather than a high value on privacy protection. Second, i-PIN users tend to participate in the online activity such as e-commerce, communication, SNS. Third, the marginal effect of i-PIN adoption amounts to 2~9% of increase in the online activity. With the results, we expect that i-PIN adoption leads to sales increase and new customer acquisition as well as privacy leakage decrease and it provides logic to solve social underinvestment problem in privacy protection.

• KDI Journal of Economic Policy
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• 제12권2호
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• pp.95-120
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• 1990

비상장기업(非上場企業)이 최초로 주식시장(株式市場)에 발행하는 신주(新株)가 실제가치에 비해 낮은 가격(價格)에 상장(上場)되는 신주(新株)의 저평가현상(低評價現象)이 번번히 일어나고 있으나 아직 그 원인(原因)이 명확히 밝혀지고 있지 않다. 또한 신주발행(新株發行)을 통한 자본조달(資本調達)의 효율성(效率性)에 관한 기존(旣存)의 연구도 전무(前無)하다. 본고(本稿)에서는 기업(企業)의 수익성(收益性)에 관하여 기업주(企業主)의 우월(優越)한 정보(情報)를 가정한 신호경기적(信號競技的) 모델의 분석(分析)을 통하여 신주(新株)의 저가상장(低價上場) 원인(原因)을 밝혀내고 아울러 신주발행(新株發行)을 통한 자본조달(資本調達)의 효율성(效率性)을 검토해 보았다. 모델의 분리균형(分離均衡)의 분석(分析)을 통해 밝혀진 주요 결과는 다음과 같다. 고수익성(高收益性)프로젝트를 가진 기업주(企業主)는 프로젝트가 저수익성(低收益性)인 경우에는 선택할 유인(誘因)이 없는 발행조건 중 자신에게 가장 유리한 조건을 선택함으로써 투자자들에게 기업이 고수익성(高收益性)임을 입증(立證)하고자 하며 이 과정에서 선택된 고수익성기업(高收益性企業)의 발행조건의 성격은 다음과 같다. 첫째, 넓은 범위와 모수(母數)값에 대해 신주가격(新株價格)은 판매대금(販賣代金)이 기업(企業)에 유입(流入)된 이후 1주(株)에 해당하는 기업(企業)의 가치에 미달한다. 둘째, 기업(企業)에 유입(流入)되는 자본(資本)은 프로젝트로부터의 잠재적(潛在的) 이윤(利潤)을 극대화(極大化)하는 액수에 미달한다. 따라서 신주(新株)의 저가상장(低價上場)은 고수익성기업주(高收益性企業主)의 신호행위(信號行爲)의 결과이며 또한 신주(新株)의 저가상장(低價上場)은 저투자(低投資)를 의미한다.

• The Journal of Asian Finance, Economics and Business
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• 제6권3호
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• pp.27-40
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• 2019

The study examines the effects of growth opportunities, debt maturity and liquidity risk on leverage, making use of a large panel of Chinese listed firms. Research on capital structure has broadened its scope from a single capital structure decision (the debt/equity choice) to various attributes of the debt in firms' capital structure. We use the system Generalized Method of Moments estimator to control for unobserved heterogeneity and the potential endogeneity of regressors. We find a negative relationship between growth opportunities and leverage. Further, we find that while the proportion of short-term debt attenuates the negative effect of growth opportunities on leverage, it negatively affects leverage as predicted by the liquidity risk hypothesis. When we distinguish between state owned firms and private controlled firms, we find evidence that these effects are only relevant to private controlled firms. However, our analysis indicates that the economic implication of liquidity risk effect is much lower for Chinese firms than that observed in the literature for US firms. Our study suggests that these differences can be explained by differences in the institutional environment in which firms operate. This finding related to Diamond's (1991) liquidity risk hypothesis extends our understanding of the relationship between liquidity risk and the debt maturity choice.

• The Journal of Asian Finance, Economics and Business
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• 제7권10호
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• pp.1-8
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• 2020

The objective of the study is to investigate the effect of growth opportunities on capital structure and dividend policy in Indonesia. The study employs panel data of companies listed on Indonesia Stock Exchange that distribute dividends from 2007 to 2017. Fixed and random effect regression models are used. Findings based on growth opportunities on capital structure and dividend policy in Indonesia are in line with the existing theory (i.e., contracting theory). Growth opportunities have a significant negative correlation with debt ratio and dividend yield, which suggests that firms with high growth opportunities are discouraged to generate debt to resolve underinvestment and asset-substitution problem. Firms with more investment opportunities tend to adopt a low dividend payout policy because the cash flows will be used up for investment. The positive impact of firm size on leverage is due to the low bankruptcy risk and cost of a large company. Profitability has a positive impact on the dividend policy because profitable companies can reserve larger free cash flows and, thus, pay higher dividends. The positive influence of ownership on leverage is interpreted by the unwillingness of majority stockholders to commit to equity financing in order to avoid reducing the ownership and preserve control of the company.

• 산경연구논집
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• 제13권1호
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• pp.11-21
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• 2022

Purpose: This study predicted cost asymmetry as a determinant of investment efficiency, and empirically analyzed the relationship between cost stickiness and investment efficiency. Research design, data and methodology: Using a sample of 4,382 Korean firm-year observations over 2011-2017 period, I examined the relationship between cost stickiness and investment efficiency. Asymmetrical cost behavior is measured as model of Homburg and Nasev (2008) and model of Park, Koo, and Pae (2012). Investment efficiency is measured as Chen, Hope, Li, and Wang (2011)'s model. Results: Firms with cost stickiness are less efficient in their investment than firms with non-cost stickiness. In other words, cost stickiness is an empirical result that supports the previous research on cost decision-making from perspective of managers pursuing private benefits due to information asymmetry. Conclusions: By showing that the manager's decision-making on the cost behavior affects the investment efficiency corresponding to capital management, the implications for the mechanism for efficient capital management are provided. Through the empirical results, it was shown that the cost stickiness is a product of opportunistic cost decision-making due to information asymmetry, and it is to present evidence that expands the meaning of the causes of asymmetric cost behavior.