Financial Profile of the Growth Engine For Corporations Headquartered in Chungcheong Province in the Republic of Korea

Financial Profile of the Growth Engine For Corporations Headquartered in Chungcheong Province in the Republic of Korea

This study addresses one of the contemporary and controversial issues identifying financialelements that affect growth rates for firms with headquarters in Chungcheong province, whichare located close to the central domestic capital markets of Seoul Metropolitan area. Primaryhypotheses were postulated and tested to derive relevant financial determinants associated withthe growth rates for the firms. Robust econometric estimations such as static panel data andprobit regression models were used in the study. Two proxy variables representing a firm’ssize and profitability, showed their statistically significant effects on the book-value basedgrowth rate, while the ratio of market- to book- value of assets was the only explanatoryvariable affecting the market-value based dependent variable. The results are expected to bebeneficial for the firms as well as for government entities. The results may help businessorganizations in Chungcheong province to identify and explore any potential opportunities soas to enhance growth and profitability.