Government Policy for Firm-Specific Efficiency

Issue title: The Role of Government in Competitive Economies

Guest editors: Evangelos S. DjimopoulosGuest Editor and Youn-Suk KimGuest Editor

Article type: Research Article

Authors: Gong, Byeong-Ho

Affiliations: Korea Economic Research Institute, 12th Fl., FKI Bldg., 28-1 Yoido-dong, Yeoundeungpo-ku, Seoul 150-758, Korea

Abstract: To overcome the rapid decline in the competitive edge of Korean products, a new industrial policy which beefs up firm-specific efficiency of the Jaebul was introduced as of June 1, 1991. To evaluate the effectiveness of this ‘specialization’ policy, which regulates the diversification of the Jaebul, this paper measures the firm-specific efficiency of Korean firms using DEA models. The paper concludes that in 24 among 34 sectors the subsidiaries of the Jaebul are operating more efficiently than independent firms.

Keywords: BBG, industrial policy, specialization policy, firm-specific efficiency, DEA models

DOI: 10.3233/HSM-1994-13205

Journal: Human Systems Management, vol. 13, no. 2, pp. 123-128, 1994