The Korean economy has experienced dramatic structural changes in almost every field including the financial and corporate sectors since the currency crisis in 1997. At the same time, the Korean SMEs sector also underwent vivid restructuring, enduring the massive bankruptcy of non-viable or undercapitalized SMEs and the remarkably activated establishment of venture startups. In particular, as the venture boom continued, technology and knowledge-intensive SMEs surfaced, raising the expectation that they would accelerate the Korean economy's transition to a knowledge-based economy and provide new vitality to the Korean industrial sector.
This study analyzes changes SMEs have experienced in their industrial structure, market segment, export structure, and financial structure, etc. Based on this, this research draws distinctive points that highlight the restructuring process of Korean SMEs and provides some suggestions for future Korean SME policies.

This study used the sample of 725 companies listed on the KOSDAQ respectively in 1998 and 2000, of which fiscal year end in December. Its research method is derived from the log-linear valuation model, which is broadly used in the current empirical study.
This empirical study examined the influences not only of traditional decisive valuation factors, equity book value and earning, but also of additional independent variables, R&D expenditures and adevertising expense by dividing the samples into general firms and venture firms. This study is expected to contribute to establish adequate accounting policy in Korea by helping understand the relations between stock price and accounting information under current stock markets.

This paper investigates the relationship between firm size and innovative activity. Firm size is defined in terms of employee number, asset, and sales respectively. R&D intensity and patent statistics are used as proxies for innovative activity. Specific hypotheses about the effect of firm size on the probability of a firm carrying out innovative activities are derived and tested on a sample of 337 listed firms in Korean manufacturing industry for the year 1999, using ordinary least square and logistic regression model. Empirical findings suggest that only when firm size is defined in terms of employee number, firm size has a positive effect on R&D expenditure, and the elasticity of firm size on R&D expenditure is greater than 1. By industry, electric & electronics and steel have a positive relationship between firm size(employee number) and R&D intensity. The hypothesis of inverse U, which means that mid-sized firms perform R&D activity intensively, was rejected. As for patent number, all firm size variables have a positive relationship with innovative activity.

The purpose of this study is to examine the effects of partner characteristics, alliance type and alliance governance structure on the performance of venture firms entering strategic alliances. More specifically, this study hypothesizes relationships among relative partner size, alliance type, degree of equity sharing and venture firms' performance, and tests them based on a sample of 153 alliances formed by 78 Korean venture firms during the period of 1999-2001. It is found that the performance of venture firms tends to be greater when they formed alliances with larger firms. It is also found that the positive effects of relative partner size on firm performance are not significantly different between marketing alliances and technology alliances. However, the positive effect of relative parter size is found to be moderated by the degree of partners' equity sharing: that is, the positive effect decreases as the degree of partners' equity sharing increases. These results suggest that venture firms can enhance performance gains when they carefully combine partner characteristics, alliance type, and the governance structure of strategic alliance.

It is widely known that first movers in any industry have absolute advantages. However, the advent of Internet poses a significant counterargument. That is, Internet-related markets are almost free of first mover's competitive advantages as they become complete information markets. As a result, existing companies hardly have an upper hand in the competition. The survival rate of those start-ups, however, is fairly low. This indicates that first mover's competitive advantages do exist in the Internet-related business as well as in other markets.
This paper mainly deals with two questions regarding first mover's competitive advantages. First, do first mover's competitive advantages exist in the Internet-related business? Second, if any, what kind of first mover's competitive advantage exercises a bigger influences on new comers?

The study attempts to forecasting small and medium businesses' accounting income using dynamic panel model. We define the ratio of net income to sales(RNS) and the ratio of operating income to sale(ROS) as the accounting income.
To test empirically the forecasting ability of dynamic panel model, We design the forecasting model used employment business survey index and industry production ability index and operating ratio index as the surrogate of extraneous variables, and sample 28.836 manufacturing firms among the small and medium business of Korea. The panel data of sampled firms during 5 year(1996-2000) is collected.
The Wilcoxon rank sum analysis of absolute forecasting error(2001) is carried out to test the relative superiority of dynamic panel model to random work model. The results confirm that the forecasting ability of dynamic panel model is superior to that of random work model and dynamic panel model shows a higher forecasting ability in RNS(large and medium company) than ROS(small company).

The efficient market hypothesis views price volatility as a result of the arrival of new information. However, empirical studies suggest that volatility cannot be explained only by changes in fundamentals. Significant amounts of volatility in asset prices come from noise trading of irrational traders. Therefore, volatility may be defined as the sum of fundamental volatility caused by information arrival and transitory volatility caused by noise trading. This study decomposes the observed KOSDAQ Composite Index volatility into fundamental volatility and transitory volatility using Kalman filtering method.
This study investigates the effects of price limit change on fundamental and transitory volatility. Most studies investigates the effect on the observed volatility. In contrast to other studies, this study investigates the effect on the fundamental volatilty and transitory volatility individually.
The sample period was divided into two sub periods - period A(60 days before price limit change), period B(60 days after price limit change). Analysis showed that observed volatility was not increased significantly, fundamental volatility was increased at 1% level, and transitory volatility did not change significantly.

This article is related to analyzing the effects of governmental support to local manufacturing SMEs. It has been done in the field survey around three industrial areas in Korea, and on the theoretical background needed, an approach was made to find out an insight in association with the development and situation of small business in local areas. As major variables, firstly strategic organizational management and organizational operating systems were considered, and secondly, its type or process management in support as moderating variables etc. The overall results showed new project development, market differentiation, and employee's job commitment have been well affected by the governmental financial supports, for which the policy reliance and transparency in the process come most importantly. Meanwhile in specific new product development, inner cash flow were the most visible effects seen with it, but revealing some difference according to regional locations. Finally, several conclusions and implications were become possible as major findings were taken into the linkage of the insight on the research purpose.

This study explores the investment behaviour and performance of business angels, who are private investors who provide risk capital directly to new and growing businesses. Before analysing investment pattern and performance of informal venture capital, we discuss the role and importance of business angels in entrepreneurial finance markets. Until the end of 1990s, the investment amount of business angels exceeds the investment of venture capital firms.
Korea introduced business angels with legislation of the special law on the promotion of venture businesses in 1997. The amount of angel capital investment into new small firms began to be increased rapidly from 1999 on. During 2000, business angels provided venture businesses with more than 500 billion Won. Korean business angels are younger and smaller compared to angels of countries such as USA, UK and Canada. But it appears that the investment frequency of business angels is more than other countries.
In this study, we attempt to measure the rate of return of angel investment in Korea. However, it is difficult to calculate the return of business angel investment because most of business angels avoid disclosing their investment performance. It is reported that the average return of angel investment in USA is between 20% and 30% per annum. We estimated the rate of return of Korean angels with utilizing 20 firms listed on either KOSDAQ or OTC markets among companies invested by businesses angels. Based on the firms of KOSDAQ, the estimated average rate of return shows 108.8%. The average return of firms trading on OTC exhibits 22.1%. We also investigate the difference of returns according to the business history of firms when business angels provide money. It is not found that there is the relationship between the level of return and the business history of investees. On the other hand, syndicated angel investments show higher return compared to non-syndicated investments.
This is the first study in Korea which explored the returns of business ventures invested by business angels. This is a little limited research because we did not estimate returns of sample businesses including many invested firms.

This study examines the relationships among environment, strategy, and structure and the impact of fit among these three constructs on small and medium sized firm's performance. The data were collected from 179 small and medium sized firms located in Daegu and Kyungbuk district area. Empirical results showed that fit among environment, strategy, and structure is still important for small and medium sized firms. Firms with high fit were performing significantly better than firms with low fit. An important finding of this research is that fit among environment, strategy, and structure is not universally applicable for all types of strategy. High performers with externally oriented strategy (i.e., differentiation strategy) achieved external fit, while high performers with internally oriented strategy (i.e., cost leadership) pursued internal fit. It is also found that most of hypotheses are better supported for high performing firms than for low performing firms. The implications of these findings, limitations, and future research directions were also discussed.

This study investigated the impact of top management, management strategy, and organizational structure on the organizational performance. The data were collected from 131 small and medium sized firms located in Daegu. Empirical results indicated that characteristics of top management, marketing differentiation strategy, decentralization, and stratification influenced on organizational performance significantly. And characteristics of top management have both direct and indirect effect on the organizational performance through management strategy and organizational structure. This study also shown that to improve organizational performance, small and medium sized firms have to persue both decentralization and stratification. In doing so, they appear to be faced with a management of paradox. The implications of these findings, limitations, and future research directions were discussed.

We examine the effects of changes in corporate income tax rate and firms' cost of capital on the capital investments. The empirical findings indicate that : (1) decreases in corporate income tax rate declines stimulates corporate capital investments ; (2) firms' cost of capital is positively correlated with firms' capital investments ; (3) in large firms, the positive effects of decreases in corporate income tax rate on capital investments dominate other effects arising from firms' cost of capital, while in small firms, the effects of the increased cost of capital on capital investments dominate other effects arising from the decreases in income tax rate. Our findings support the policy maker's view that economic policy through the changes in tax rate is effective.

The purpose of this research is to examine the major determinants affecting the user's satisfaction on Portal Sites for Trade(PST) in small and medium-sized exporters. The development of our research model is based on the empirical studies on the quality of information system, web sites and Internet shopping mall, and on the factors influencing the user's satisfaction. With the help of a LISREL-based structural model, six hypotheses are derived and tested. The results from the structural model suggest that the user's satisfaction of PST is affected by ease of information search, responsiveness as well as usefulness of PST. In addition, the intention to use PST is enhanced by the user's satisfaction on the utilization of PST. Our findings will be useful, especially for those who are planning to build user-oriented PST.

The purpose of this study was to investigate the differences in job stressors, job stress symptoms, and job performance among groups classified by organizational climate factors. The data were obtained from questionnaire completed by 529 workers who were employed in textile or clothing manufactures located in Seoul, Daegu, and Gyeongsang-do province. Cluster analysis was employed in grouping respondents based on organizational climate factors. The respondents were classified with 3 groups(open-democratic, benevolent-hierarchic, closed- authoritative group). There were significant differences in personal characteristics, job stressor, job symptoms, and job performance among 3 groups.

The purpose of this study is to find the characteristics of Organizational Commitment and mediating effects of individual values in employees of korean small-medium sized firms. We analysed mediating effects of individual values between independent variables and Organizational Commitment.
Being consistent with the existing literatures, tenure was found to be positively correlated to AC but negatively correlated to CC. Formalization and centralization were found to be positively correlated to AC and CC but negatively mediated to CC by individualism.
These results would have two practical implications. First, the korean small-medium sized firms need to emphasize individual motivation and economic incentives rather than forcing loyalty to individual employees to build a efficient HRM systems because the level of individualism was raised. It is also recommended that the firms should emphasize proper evaluating and compensating systems through fair rules and procedures, keeping individual autonomies and communications.