KDI - Korea Development Institute - RESEARCH - Research Areas

Summary

Research Monograph KOR The Economic Implication of Land Purchase: A Study on the Net Purchase of Land by Corporate Sector Over the Long Term

This study uncovers the fact that Korean companies have been purchasing a large amount of land from households for about 40 years using various statistics such as national accounts and corporate financial data and examines empirically the incentives of corporations to purchase land.

We argue that the accumulation of land assets over a long period of time by Korean corporations is an unusual phenomenon. From 1975 to 2018 in which South Korea's sectoral national accounts statistics exist, the large net purchases of land by Korea's non-financial corporations from the household sector have been observed every year except before and after the foreign exchange crisis in 1998 and the global financial crisis in 2008. We find that among OECD countries Japan in the 1960s to early 1990s is the only case where the non- financial corporations had purchased a large amount of land from the household sector every year such as South Korea.

Firms can purchase land for either productive or speculative activities. In the case of productive activities, we investigate a hypothesis that companies' demand for land could have increased significantly, especially since the 2000s, due to the changes in the industrial structure of South Korea. We use the Economic Census by Statistics Korea (2010, 2015) to show that firms in the place where service industries are more agglomerated are likely to purchase more land than those resided in less service-intensive areas. By using a firm- level micro dataset, KIS-DATA, to estimate the elasticity of land as a firm's production input, we also show that the contribution of land to production has increased significantly after the 2000s.

Unlike capital goods such as equipment and buildings, the land does not suffer from depreciation and its supply is inelastic, so the land is an investment good that can benefit from rising prices as the economy develops. Companies, thus, could have speculative incentives to invest part of their operating profits on land. We use the Economic Census by Statistics Korea (2010, 2015) to show that some firms experiencing positive operating profits and decreased production facilities are likely to purchase land. This suggests that the net purchases of land by corporations could occur in part due to their speculative motive.

Summary

Other Research KOR A Study on Measures to Facilitate Supplementary & Ancillary Projects

Ⅰ. Introduction

　1. Background and Purpose of the Study
　2. Key Contents of the Study

Ⅱ. Current Status of Supplementary & Ancillary Projects

　1. Definition of Supplementary & Ancillary Projects
　2. Current Status of Supplementary & Ancillary Projects in Korea
3. Overseas Cases of Supplementary & Ancillary Projects and Implications

Ⅲ. Factors that Restrict Implementation of Supplementary Projects and Unsuccessful Case

　1. Key Constraints
　2. Reasons to Failure
　3. Unsuccessful Case of Supplementary & Ancillary Projects
　4. Implications

Ⅳ. Survey on Perception of Supplementary & Ancillary Projects by Private and Public Sectors

　1. Private Sector Perception
　2. Public Sector Perception
　3. Comparison of Survey Result

Ⅴ. Plans to Facilitate Implementation of Supplementary & Ancillary Projects

　1. Feasibility and Precondition to Facilitate Supplementary & Ancillary Projects
　2. Plans to Facilitate Supplementary & Ancillary Projects
　3. Conclusion

※ REFERENCES
※ APPENDIX

Summary

Other Research Improving Public Investment Management for Large-Scale Government Projects: Focusing on the Feasibility Studies - Lessons and Challenges -

PART I. OVERVIEW OF THE FEASIBILITY STUDIES

　CHAPTER 1. Project Preparation and Evaluation Experience at the World Bank
　Songsu Choi
　　1. Introduction
　　2. Feasibility Study and Evaluation
　　3. Separate Responsibilities for Preparation and Evaluation
　　4. Project Preparation and Appraisal Agenda
　　5. Rise and Fall of Economic Evaluation at the World Bank
　　6. Use and Abuse of Project Analysis
　　7. Thoughts on the Korean Prefeasibility Study System and its Further Development

　CHAPTER 2. Improving Public Expenditure Management for Large-Scale Government Projects: Focusing on a Feasibility Study: the case of the major projects financed in the framework of the EU cohesion policy
　Jorgen GREN
　　1. Introduction
　　2. The framework in the EU for financing major projects and the role/decisions of the Commission
　　3. The feasibility study in the EU context

PART II. LEGAL AND MANAGEMENT ISSUES IN THE FEASIBILITY STUDIES

　CHAPTER 3. Public Finances Effective Management as a Factor of Long-term Economic Growth-Polish Experience
　Marata Postula
　　1. Introduction
　　2. Different budget expenditures concerning co-financing programs and domestic policy of the EU
　　3. Summary

　CHAPTER 4. Feasibility Studies under the System for Evaluating Government Policies in Japan
　Chigako Yamamoto
　　1. Introduction
　　2. Structure of the Japanese Government
　　3. History of Development of the System for Evaluating Government Policies
　　4. System for Evaluating Policies of the Central Government
　　5. The System for Evaluating Policies, Programs and Projects of the MLIT
　　6. Cost-Benefit Analysis for MLIT projects
　　7. Case Studies: Termination of Projects Based on Interim Evaluation
　　8. Issues of Feasibility Studies under Japanese Systems for Evaluating Government Policies
　　9. Conclusions

　PART III. EVALUATION AND DECISION-MAKING RULES FOR THE FEASIBILITY

　CHAPTER 5. Decision-Making for Major Infrastructure Investments: Measuring Feasibility in the US
　Erik Cempel
　　1. Introduction
　　2. Policy Framework and Legislation
　　3. Component Elements of the Feasibility Study
　　4. Survey of US Feasibility Studies
　　5. Lessons and Conclusions

　CHAPTER 6. The COSIMA Approach to Transport Decision Making: Combining Cost-benefit and Multi-criteria Analysis for Comprehensive Project Appraisal
　Steen Leleur
　　1. Introduction
　　2. COSIMA methodology
　　3. COSIMA decision conference
　　4. COSIMA software
　　5. Comparison of COSIMA to other approaches
　　6. Conclusions and perspectives
　　Appendix : Technical notes

PART IV. KOREA'S EXPERIENCES IN THE PRELIMINARY FEASIBILITY STUDIES

　CHAPTER 7. Preliminary Feasibility Study (PFS) : Performance and Challenges
　Hyeon PARK
　　1. Introduction
　　2. Performance
　　3. Challenges

　CHAPTER 8. Implementation System and Analysis Methodologies of the Preliminary Studies
　Kang-Soo Kim and Jeong Whon Yu
　　1. Introduction
　　2. Framework of the Preliminary Feasibility Studies (PFS)
　　3. Methodologies focusing transport projects
　　4. Conclusions

　CHAPTER 9. Beyond Technical Information Providers: The Expanded Role of Policy Analysts of Public Investment in Korea
　Kilkon Ko
　　1. Introduction
　　2. The Unusual Success of Policy Analysis of Public Investment in the Korean Government
　　3. Political Expectations to the Policy Analysis
　　4. The External Demand of Rational Public Investment
　　5. Enhancing the Accuracy of Analysis
　　6. Explicit Judgment Model Preventing Arbitrary Interpretation
　　7. The Responses to the Adoption of PFS by Politicians and Bureaucrats
　　8. Conclusion
　　Appendix. KDI AHP Process

Summary

Other Research KOR A Study on Environmental Cost Estimation in Pre-feasibility Study of Transportation Projects

Ⅰ. Background and Purpose of the Study

　1. Environmental Impact Evaluation in Pre-feasibility Study
　2. Need for Environmental Impact Evaluation in Feasibility Study
　3. Background and Purpose
　4. Scope
　5. Methodology and Direction

Ⅱ. Environmental Impact of Public Investment Projects

Ⅲ. A Study on Means to Introduce Environmental Impact Evaluation

　1. Feasibility Study and Environmental Impact Evaluation
　2. Environmental Impact Evaluation in Developed Countries
　3. Environmental Impact Evaluation in Korea
　4. Environmental Impact Evaluation Method in Pre-feasibility Study

Ⅳ. A Study on Environmental Impact Evaluation Technique

　1. Overview of Evaluation Technique
　2. Study on Environmental Impact Evaluation Technique
　3. Selection of Environmental Impact Evaluation Technique for Pre-feasibility Study

Ⅴ. Comparison of Environmental Cost Estimation Methodologies

　1. Review of Environmental Impact Valuation Methodologies
　2. Analysis of Prior Studies on Estimating Environmental Cost in Transportation Sector
　3. Review of Value Estimation Methodology for Pre-feasibility Study

Ⅵ. Estimation of Environmental Cost

　1. Estimation of Air Pollution Cost Benefit
　2. Estimation of Noise Cost Benefit
　3. Estimation of Forest Exploitation Cost
　4. Application of Environmental Cost Estimation Results

Ⅶ. Evaluation Methods of Non-Quantitative Environmental Impact

　1. Need for Non-Quantitative Environmental Impact Assessment
　2. Preliminary Environmental Review and Environmental Impact Assessment
　3. Study on Methods for Non-Quantitative Environmental Impact Assessment in Pre-feasibility Study
　4. Summary and Conclusion

Ⅷ. Conclusion

　1. Summary of Results
　2. Future Challenges

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