A Study on the Determinants of the Survivorship of Listed Companies in Korea

초록

Using the proportional hazard model developed by Cox (1972, 1975), this paper empirically examines the determinants of survivorship (or exit) of the listed companies in Korea Stock Exchange. Our dataset comprises of 719 listed firms whose complete financial statements are provided by Korea Investors Service (KIS), Inc. It covers the period between 1980 and 1998. We obtain the following results. The firm size, R＆D investment, the largest shareholder`s share and the time between establishment and listing have favorable effects on the survival probability. The share held by institutional investors has a negative effect. Surprisingly, the effects of financial variables such as capital-asset ratio, operation income ratio and net income ratio turn out to be insignificant. The industry specific variables such as capital-labor ratio and concentration ratio are also insignificant.

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