Early-stage financial globalization and corporate debt maturity: The case of South Korea, 1980-1994

Using data from publicly traded South Korean corporations for the period 1980-1994, this paper finds evidence that increases in financial liberalization that accompanied the more general process of financial globalization have shortened the maturity of corporate debt contracts. This effect of financial liberalization on corporate debt maturity is robust to changes in econometric specification, and does not seem to be capturing the explanatory power of an omitted time trend. A nuanced view of the effects of financial liberalization on the shortening of corporate debt maturity arises when these findings are combined with previous findings by related literature.