The Asian Economic Crisis and the Corporate Control of Korean Chaebols

Abstract

The Korean government has been pursuing the structual reformation of the economy, especialy focusing on the Korean family enterprise groups, which are called chaebol. Chaebols are family owned enterprises, being managed by a commander in chief as owner. Their expansion-oriented corporate behavior pushed the national economy into the economic crisis of 1997. Due to that, the Korean government has started to change the governance system of chaebols.

The purpose of this article is to reveal the policies of Korean government and the chaebols attitude toward them. By observing the recent situation of chaebols regarding ownership and control it can be said that the management system of chaebols has not yet changed drastically, and power of chaebol owners has been more strengthening than before.