Department of Accounting & Finance
Permanent URI for this collectionhttps://hdl.handle.net/11274/9565
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Browsing Department of Accounting & Finance by Author "Chung, Chune Young"
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Item Firm-level political risk and corporate investment(Elsevier, 2022) Choi, Wonseok; Chung, Chune Young; Wang, KainanExtant literature shows that firms reduce their capital investment in response to political risk. We examine firm-level activities and characteristics that mitigate the impact of political risk on firm investment. First, we empirically investigate the relationship between firm-level political risk and future investment, showing that firms with higher political exposure and political risk spend less on capital investment. Next, we examine the mechanisms behind the negative relationship between firm-level political risk and corporate investment. We find that political lobbying effectively reduces the negative impact of political exposure and political risk on corporate investment. In addition to corroborating the key findings documented in the literature that firms react to political risk by cutting investment, we show that this relationship is affected by certain firm activities and characteristics.Item How do heterogeneous institutional investors influence corporate advertising decisions?(Elsevier, 2022) Kang, Sanggyu; Chung, Chune Young; Choi, WonseokMarketing increases firm value; therefore, it is imperative to determine the factors affecting corporate marketing decision processes. Considering that the current understanding of these factors is limited, this study examines institutional investors’ effects on Korean firms’ marketing decisions by focusing on advertising spending. We present evidence that institutional investors may play a significant role in such decisions. Further, our results indicate that domestic institutional investors negatively influence advertising spending. In contrast, foreign institutional investors positively impact advertising spending regardless of their investment horizon. These results highlight the influence of external institutions’ characteristics in firms’ marketing decision processes.Item Pension fund monitoring and corporate debt policy: Evidence from the Korean market*(Wiley, 2021) Choi, Wonseok; Chung, Chune Young; Park, JongchanWe investigate whether the Korean National Pension Service, a corporate watchdog and major long-term investor in South Korea, positively affects corporate financial policy. The Korean National Pension Service is less likely to influence corporate financial policy even among firms with high uncertainty and information opacity, which increases the importance of large shareholders’ monitoring role. Additionally, ownership by the Korean National Pension Service has statistically insignificant effects on firms’ performance and financial soundness.Item Related party transactions and corporate environmental responsibility(Elsevier, 2022-05) Choi, Wonseok; Chung, Chune Young; Rabarison, Monika K.; Wang, KainanWe examine the effect of related party transactions on corporate environmental responsibility and find that firms with more related party transactions tend to have more controversial environmental reports, less emissions reduction, and less environmental expenditures. This relationship is more significant for firms with a high investment-cash flow sensitivity and those with a low ESG score. Overall, the results corroborate the hypothesis that the marginal costs of corporate environmental responsibility outweigh the benefits for financially constrained firms, thus deterring these firms from engaging in corporate environmental responsibility activities.