英语论文网

hareholders. Forth, regulation of the portfolio and direct investment was alleviated and M&A was permitted.

In fact, most East Asian countries, including Southeast Asia, were in trouble with the abnormal operations of business firms. The strong dependence on foreign direct investment and on foreign debt to finance ongoing industry investments in the ever-growing East Asian economies caused economist H. W. Singer to record in 1984 that “export-led growth has really become debt-led growth”. Singer also forewarned that a combination of high levels of short term debts together with floating exchange rates “meant that the whole continued process of global integration rested on shaky foundation” (Singer, 1984: 85; Feridhanusetyawan, Stahl, Toner, 2001: 503). This is surprisingly true in respects to the East Asian events that followed in 1997 and 1998. Therefore, highly debt-operated corporations should be eliminated from the scene, and Table 4.7 shows the reality of the economic conditions in East Asia.

On the other hand, Asian countries were obliged to execute the organizational transformation in the midst of strong structural reform. Such jargons as the “flat organization”, the “teamwork organization”, the “network organization”, etc. were flooded into the East Asian horizon. By the way, all these new forms of organization are closely related to the sliming down of organization, and the middle layers became the target of lay-off. That means the “downsizing of Asia”, which Francois Godement (1999) used as the title of his book.

Table 4.8 indicates the employment trends in the target corporations of structural adjustment. As is well shown, the number of employees rises up to the maximum point in 1997. 1,559 thousand employees had their seats in the corporations within big 30 business groups. But from that time on, the volume has decreased continuously. Accordingly, the number of employees recorded 1,222 thousands in October 2002. Therefore, total 337 thousand people lost their jobs, and the rate of decrease in the number of manpower was about 21%. Of course, in the period of economic expansion between October 1999 and September 2000, the number slightly rose up.

But we must take notice of the fact that whereas the total rate of unemployment fell from 7.5% to 5% in the period between October 1998 and September 1999, 6.2% of manpower was reduced in the same period (Kim and Jeon, 2003: 6-7). Considering that it was the period of economic recovery, structural adjustment was still going on, irrespective of the economic cycle.

When comparing the large corporations within the big 30 business groups in Korea, the banking facilities, and the public enterprises, what shows the most sensitive response to the changing environment were the large corporations, because total 26% employees were fired out between October 1997 and September 2001. A sober calculation shows that the rate of 26% is double the number of employees in the banking facilities. In case of the banking facilities, reduction of manpower was relatively small, and it is thought to be the result of so-called “hostage effect”. Of course, it belong to a commonsense that the so-called “agency problem” usually occurs in the public enterprises. But under the sway of fiscal crisis, the government could not refrain from executing the strong measures for structural adjustments. The number of 23% shows such result.