| Srl | Item |
| 1 |
ID:
177828
|
|
|
|
|
| Summary/Abstract |
This study explores the impact of geopolitical events on the stock return behavior of inter-Korean economic cooperation-related firms depending on the North Korean regime. We document empirical evidence showing that cross-sectional stock return tends to react positively to positive geopolitical events under the current regime in North Korea (Kim Jong-un), whereas negative geopolitical events have limited impact. Conversely, we find that negative geopolitical events yielded more pronounced effects on the stock returns of related firms under the former regime (Kim Jong-il). In addition, this study investigates the role of geopolitical shock in the evolution of aggregate economic variables of South Korea using Caldara and Iacoviello’s (2018) geopolitical risk index. Geopolitical shock is found to yield no statistically meaningful impact on stock price index, industrial output, employment, or gross trade volume. Furthermore, aggregate stock market variables are found to be immune to geopolitical shock in South Korea. These results indicate that market participants estimate the escalation of geopolitical risk into full-scale war as unlikely.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 2 |
ID:
071711
|
|
|
|
|
| Publication |
2005.
|
| Summary/Abstract |
Though the North Korean nuclear issue has resurfaced- subsequently restraining inter-Korean cooperation-this impasse has not fettered the South Korean government in such a way that it cannot maneuver to improve the ROK-DPRK relationship. Seoul must take small steps to solve individual problems in the North-South relationship, and methodically prepare for systematic advances in inter-Korean relations once the nuclear impasse is settled. Furthermore, Seoul must focus on both quantitative and qualitative improvements in the inter-Korean relationship, look more at economic cooperation that emphasizes mid- to long-term development of North Korea, and concentrate on developing a blueprint for the North's recovery that acknowledges greater involvement from regional actors. This article sets out to find that new direction in which South Korea must proceed.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|