earticle

영어

This paper analyzes how corporate financial performance is affected by changes in government policy and regulation, focusing on the construction industry. We analyze the performance of construction firms listed on the KOSPI and KOSDAQ markets from 2001 to 2022 from both financial and non-financial perspectives. In particular, construction firms listed on the KOSPI and KOSDAQ, which are closely related to the domestic real estate market, can experience significant changes in profitability depending on government policies and regulations. We use kernel density estimation to convert discrete financial indicators into continuous probability distributions to examine changes over time. To understand this more precisely, we conduct a dynamic panel analysis to examine the impact of government policy and regulatory variables on the profitability of construction firms. The empirical results show that government regulations affect the profitability of construction firms. The result of robustness analysis shows that the impacts of government policies and regulations on between KOSPI firms and KODAQ are somewhat different.