Service-Driven Growth Pattern In IT Industries And Contributing Factors:A New Pattern In The Korean Industrial Development Perspective

This paper examines the pattern behind rapidly growing Korea’s IT industries. Korea has characterized economic growth based on export demand rather than domestic demand at the traditional industries such as automobile, electronics, steel, and shipbuilding etc. However, the recent development of IT industry is indicating a different aspect from traditional sectors. The rapid growth in service demand is becoming a key factor in the rapid growth and high competitiveness of IT industry. A statistical estimation testing relationship between mobile telecommunication, Internet service, and wireless equipment, computer, strongly supports service-driven growth pattern of IT industry. Strong network externalities in demand side, government’s demand promotion policies, residential environment, and users’ preferences, are main contributing factors to this new growth pattern

CHANGING ECONOMIC NATURE OF NETWORK RESOURCES DUE TO NETWORK CONVERGENCE

The advanced technologies of the converged network are going to change the economic nature of the telecommunication network, especially the Internet. The Internet of today is an example of common resources and is suffering the tragedy of commons problem, i.e., it is overused. However, as the new network technologies of the converged network progress, the Internet will change from a common resource to a private resource and the tragedy of commons problem is expected to disappear. This paper discusses how network convergence transforms the economic nature of the Internet and raises new economic issues that we are going to face soon in the era of the broadband converged network (BcN). I

Stock Market Reaction to Mergers and Acquisitions in Anticipation of a Subsequent Related Significant Event: Evidence from the Korean Telecommunications Industry

The objective of this paper is to assess the effect of mergers and acquisitions on shareholder wealth when subsequent related significant events are anticipated. We identify a particular merger and acquisition between telecommunication companies in Korea and examine whether it conveys good or bad news to stock market participants. We hypothesize and find that mergers and acquisitions are interpreted as good news by the marketplace when they are expected to be accompanied by a subsequent related significant event, in our case granting of a government license for the IMT-2000 mobile service.Mergers and acquisitions, telecommunications industry, IMT-2000, mobile service

Earnings Management of Acquiring Firms in Stock-for-Stock Takeovers in the Telecommunications Industry

This article investigates whether acquiring telecommunications firms managed their earnings by means of discretionary accruals prior to the announcement of stock-for-stock takeovers in the U.S. telecommunications industry during the period of 1990 to 2006. The results show that acquiring telecommunications firms manage earnings upward prior to stock-for-stock takeovers. In addition, this article finds that there is a negative short-term wealth effect over the days surrounding stock-for-stock takeover announcements, and there is an inverse relation between earnings management and short-term wealth.