• KDI Journal of Economic Policy
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• v.31 no.1
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• pp.27-69
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• 2009

This paper studies the logic of fiscal constraints and fiscal autonomy in a political agency model with both moral hazard and adverse selection. The electoral process not only disciplines incumbents who may act against the public interest but also opts in politicians who are most likely to act along voters' interests. We characterize perfect Bayesian equilibria under shared tax system and fiscal autonomy with fiscal constraints for local public good provision. It is shown that the local voters' expected welfare under fiscal autonomy is higher than under shared tax system if the same fiscal constraints are applied. In order to examine the effects of party's candidate selection processes on the behavior of local politician and national politician, we extend the model to an environment where local politician can compete for the candidacy of national assembly with incumbent national politician. If local politician wins majority of votes against incumbent national politician, then he can move on to serve as a national politician. Otherwise, his political career will end as a local politician. It is the gist of this primary system portrayed by this setup that local politician and national politician compete to garner more votes. Therefore, primary system as a candidate selection mechanism enhances local residents' welfare compared to top-down candidate selection processes.

• The Journal of Economics, Marketing and Management
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• v.9 no.4
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• pp.1-8
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• 2021

Purpose: This study empirically investigates what factors contribute to corporate value in the Korea New Exchange (KONEX) market and determines whether financial constraints contribute any effect on it. Research design, data and methodology: A fixed-effect panel regression model was utilized to analyze financial constraints on firm value for KONEX listed firms through the fiscal period from 2013 to 2020. Results: we find that firms' research and development, volatility, size, and sales growth give significant impacts to firm value, but the significance and direction are different. In addition, no significant relationship exists between the largest shareholder's equity ratio and firm value in all models. The debt-to-equity ratio did not show a significant relationship with corporate value. A significant negative relationship was found between R&D and corporate value in the entire sample. Volitility exhibited a positive relationship with corporate value in the entire sample and financially unconstrained companies. Firm size presented a significant negative relationship with company value in all models. Sales growth showed a significant negative relationship with corporate value in financially constrained companies. Conclusions: No difference is found between financially constrained and unconstrained companies in the KONEX market. We can infer that KONEX companies have a large difference with KOSPI or KOSDAQ. Further analysis is needed on the differences among these markets.

• Informatization Policy
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• v.26 no.4
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• pp.3-19
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• 2019

Many countries have developed e-governments, but their current statuses differ by country, as demonstrated in the United Nations E-Government Survey. This study focuses on what factors cause these differences. Specifically, it analyzes economic and organizational factors, both of which have not yet been sufficiently considered. Through quantitative and qualitative analyses, the results show that GDP growth and the days required to start a business are important factors, while fiscal balance does not appear to affect e-government development as much. In addition, the existence of allocated ministries or departments that belong to a president or prime minister are also important for e-government progression.

• International conference on construction engineering and project management
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• 2022.06a
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• pp.3-10
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• 2022

An estimated investment gap of $176 billion needs to be filled over the next ten years to improve America's inland waterway transportation systems. Many of these infrastructure systems are now beyond their original 50-year design life and are often behind in maintenance due to funding constraints. Therefore, long-term maintenance strategies (i.e., asset management (AM) strategies) are needed to optimize investments across these waterway systems to improve their condition. Two common AM strategies include policy-driven maintenance and performance-driven maintenance. Currently, limited research exists on selecting the optimal AM approach for managing inland waterway transportation assets. Therefore, the goal of this study is to provide a decision model that can be used to select the optimal alternative between the two AM approaches by considering key uncertainties such as asset condition, asset test results, and asset failure. We achieve this goal by addressing the decision problem as a single-criterion problem, which calculates each alternative's expected value and certain equivalence using allocated monetary values to determine the recommended alternative for optimally maintaining navigable waterways. The decision model considers estimated and predicted values based on the current state of the infrastructure. This research concludes that the performance-based approach is the optimal alternative based on the expected value obtained from the analysis. This research sets the stage for further studies on fiscal constraints that will effectively optimize these assets condition.

• Proceedings of the KSR Conference
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• 2008.06a
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• pp.1458-1465
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• 2008

With 34 years of accumulated operating experience, Seoul Metro has launched a project aimed at exporting second-hand trains(used EMU cars) to Vietnam while seeking measures for diversifying its business such as the construction of the metropolitan railways both at home and abroad, and operating business as a way of fiscal consolidation and management improvement. Therefore, Seoul Metro has moved ahead with this plan considering that there's no legal constraints on durable period of rolling stocks in advanced countries where the vehicles have been used for 35 years or longer than 40 years through renovation such as safety inspection and comprehensive maintenance program, and the railway systems for the replacement are expected to reach 838 cars by 2015 with growth of 100 cars a year. Seoul Metro strives to create value for boosting revenues and recycling resources by sending used EMUs to Vietnam. Seoul Metro will also provide under-developed countries with cars at a low price as well as share the accumulated railway technical know-how so that it can promote the national image and obtain the pre-emptive effect of metro railways in Vietnam.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.8
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• pp.137-148
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• 2021

The study investigates the existence of an optimal level of cash and the firm characteristics influencing the decision to hold cash, and the adjusting speed of the cash holdings to the target level. It highlights the heterogeneity of cash adjustment speed in the Vietnam market. The research employs the 417 samples of Vietnamese non - financial listed firms in the period of 2010 to 2019. The study uses the Pool OLS model, Fixed effect model (FEM), Random effect model (REM), and GMM model. According to the research findings, there is an optimal amount of cash at which the firm's value is maximized in Vietnamese listed firms, and the majority of the firms in the sample retain cash over the target level. Furthermore, the study demonstrates that firms actively modify their cash holdings to the optimal level with an adjustment speed of less than one owing to adjustment cost constraints. This speed varies between groupings of enterprises with different characteristics, underlining the heterogeneity of the adjustment speed even more. Small deviation firms adjust more rapidly than large deviation firms. Large free cash flow (FCF) firms adjust more readily than small FCF firms, and fiscal deficit firms modify more rapidly than firms with a financial surplus.

• Korean System Dynamics Review
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• v.10 no.1
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• pp.77-95
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• 2009

The ever-increasing government budget constraints have led to a continued decline in the increase rate for defense spending, and the government's 5-year National Fiscal Management Plan has served to reinforce the verification and validation procedures for the Force Improvement Programs (FIP) budget requirements and performance. Additionally, as large programs are controlled in accordance with the Total Program Cost Management Guidelines, timely and credible feasibility study and performance measurement need to be conducted. Due to these internal and external circumstances, needs have surged for feasibility and economic effectiveness study for big ticket projects in the FIP sector, with an increasing number of studies conducted by external research institutes. However, questions have been raised regarding the credibility and thoroughness of the program analyses performed by these research institutes due to various restrictions. This paper analyzes and identifies the structural limitations and problems using a systems thinking approach, and examines the systemic characteristics of the program analysis system. It also presents policy intervention recommendations based on the theory of systems thinking, a method to regularize and reinforce the program analysis system. Policy interventions recommended to ensure alignment of the external studies to the clear analysis objectives and resolve the bottlenecks in the external analysis include training those in charge of external study commissioning for a short term intervention, and increasing the number of research institutes and consulting agencies utilizing analysis and evaluation experts who transition to the private sector from the military for a long term intervention. additionally presented are strategies and policy alternatives to best utilize these policy interventions. They will contribute to the stable funding of Force Improvement Programs and efficient utilization of defense budget.

• Strategy21
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• s.44
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• pp.5-27
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• 2018

The purpose of this paper is to look at USN's efforts to rebuild its combat power in the face of a reemergence of great powers competition, and to propose some recommendations for the ROKN. In addition to the plan to augment its fleet towards a 355-ships capacity, the USN is pursuing to improve exponentially combat lethality(quality) of its existing fleet by means of innovative science and technology. In other words, the USN is putting its utmost efforts to improve readiness of current forces, to modernize maintenance facilities such as naval shipyards, and simultaneously to invest in innovative weapons system R&D for the future. After all, the USN seems to pursue innovations in advanced military Science & Technology as the best way to ensure continued supremacy in the coming strategic competition between great powers. However, it is to be seen whether the USN can smoothly continue these efforts to rebuild combat strength vis-a-vis its new competition peers, namely China and Russian navy, due to the stringent fiscal constraints, originating, among others, from the 2011 Budget Control Act effective yet. Then, it seems to be China's unilateral and assertive behaviors to expand its maritime jurisdiction in the South China Sea that drives the USN's rebuild-up efforts of the future. Now, some changes began to be perceived in the basic framework of the hitherto regional maritime security, in the name of declining sea control of the USN as well as withering maritime order based on international law and norms. However, the ROK-US alliance system is the most excellent security mechanism upon which the ROK, as a trading power, depends for its survival and prosperity. In addition, as denuclearization of North Korea seems to take significant time and efforts to accomplish in the years to come, nuclear umbrella and extended deterrence by the US is still noting but indispensible for the security of the ROK. In this connection, the naval cooperation between ROKN and USN should be seen and strengthened as the most important deterrents to North Korean nuclear and missile threats, as well as to potential maritime provocation by neighboring countries. Based on these observations, this paper argues that the ROK Navy should try to expand its own deterrent capability by pursuing selective technological innovation in order to prevent this country's destiny from being dictated by other powers. In doing so, however, it may be too risky for the ROK to pursue the emerging, disruptive innovative technologies such as rail gun, hypersonic weapon... etc., due to enormous budget, time, and very thin chance of success. This paper recommends, therefore, to carefully select and extensively invest on the most cost-effective technological innovations, suitable in the operational environments of the ROK. In particular, this paper stresses the following six areas as most potential naval innovations for the ROK Navy: long range precision strike; air and missile defense at sea; ASW with various unmanned maritime system (UMS) such as USV, UUV based on advanced hydraulic acoustic sensor (Sonar) technology; network; digitalization for the use of AI and big data; and nuclear-powered attack submarines as a strategic deterrent.