Diversification Process and the Ownership Structure of Samsung Chaebol

Abstract

Abstract The Korean economy has grown rapidly during the last three decades. The annual GNP growth rate from 1963 to 1993 was 9.4 per cent on average, which was the fastest in the world compared with either the developing countries in the same period or the developed countries in the nineteenth century (their early developing period). The leading type of business group in this rapid economic growth was the chaebol, which can be defined as ‘a business group which is owned and controlled by a person and that person ‘s family ‘. This definition coincides for the most part with Morikawa ‘s definition of a zaibatsu, as ‘ exclusively owned and controlled by the family ‘, and probably also fits the rest of the definition, ‘diversified industrial firms ‘, since it is a business group. In Korea thirty chaebol are famous; their names are announced officially as ‘the thirty largest business groups ‘ every year on the first day of April. They account for 35.7 per cent of total shipments in the mineral and man ufacturing sector, 31.6 per cent of value-added, and 15.9 per cent of employment in the same sector. More than one-half of this share falls to the five largest chaebol.