American International Journal of Social Science

The Ceiling on the Total Amount of Share Holdings of Other Domestic Companies and Corporate Investment in Korea’s Chaebol
Chul-kyu Kang, Jae-Hyung Lee

Abstract
Using pooled OLS and panel estimations with cross-company panel data for sixty Chaebol-affiliated companies in 2004 and for seventy eight Chaebol- affiliated companies in 2005, the regression results are consistent with the hypothesis that, with other things given, the ceiling on the total amount of share holdings of other domestic companies by Chaebol does not affect corporate investment in Korea. The regression results reveal that the ceiling on the total amount of share holdings of other domestic companies promotes fair competition which in turn enhances the economic democritization and thereby balanced growth. In order to monitor the opaque governance structure of Caebol, therefore, the democratic citizenship education should be strengthened.

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