Government-connected Board and Allocative Distortion : Evidence from the Korean Construction Industry
- 주제(키워드) Government connections , Government-connected board , Public procurement , Optimality of allocation
- 발행기관 서강대학교 국제대학원
- 지도교수 김현동
- 발행년도 2020
- 학위수여년월 2020. 2
- 학위명 석사
- 학과 및 전공 국제대학원 InternationalFinance
- UCI I804:11029-000000065175
- 본문언어 영어
- 저작권 서강대학교 논문은 저작권보호를 받습니다.
초록/요약
This paper examines whether the presence of government-affiliated directors on corporate board increases the government resources assigned to firms and further whether this allocation is efficient in terms of firm and social value. Using the data on procurement contracts and board composition to Korean firms over the 2001-2018 periods, I find that firms with government-affiliated directors obtain greater amount of government resources allocated through their social connections, and increase their value by increasing sales, investments, and profits. Further, my result shows that the contracts allocated to firms with government-affiliated directors exhibit an increase in costs by amending contracts. This paper contributes to the corporate finance literature on political connections by directly examining the allocation of governance resources which can be induced from government-connected board.
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