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What drives Korean firms to downsize under the global financial crisis?

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  • Byoung-Hoon Lee
  • Jung-Min Nam

Abstract

Drawing upon the Korea Workplace Panel Survey (KWPS) data, this study examines how Korean firms responded to the global financial crisis (GFC), and in particular, what factors induced Korean firms to adopt downsizing actions. Analysis reveals that Korean firms are driven to implement downsizing due to experience with prior episodes of redundancy action, rather than due to economic considerations of business difficulties. The institutionalized norm of downsizing in the common cognitive mode of management was found to be an unstable entity influenced by the social pressure of public opinion, and particularly challenged by the oppositional force of the anti-downsizing point of view.

Suggested Citation

  • Byoung-Hoon Lee & Jung-Min Nam, 2013. "What drives Korean firms to downsize under the global financial crisis?," Asia Pacific Business Review, Taylor & Francis Journals, vol. 19(2), pages 171-185, April.
    • Handle: RePEc:taf:apbizr:v:19:y:2013:i:2:p:171-185
    DOI: 10.1080/13602381.2013.767634
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    References listed on IDEAS

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    1. Peter Cappelli, 2000. "Examining the Incidence of Downsizing and Its Effect on Establishment Performance," NBER Working Papers 7742, National Bureau of Economic Research, Inc.
    2. Peter Cappelli & David Neumark, 2001. "External Job Churning and Internal Job Flexibility," NBER Working Papers 8111, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Thulisile Manyi & Rosemary Sibanda & Ankit Katrodia, 2018. "The Effect of Using Multi-Skilled Workforce on the Flexibility of Project Resource Scheduling and Project Costs," Journal of Economics and Behavioral Studies, AMH International, vol. 10(4), pages 235-251.

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