The Efficiency of Industrial Capital Allocation in Taiwan

• Main Authors: Shiu-Ling Liu, 劉秀玲
• Other Authors: Chih-Young Hung
• Format: Others
• Language: zh-TW
• Published: 2003
• Online Access: http://ndltd.ncl.edu.tw/handle/09697251470770508515

碩士 === 國立交通大學 === 科技管理所 === 91 === For a nation to continuously creating wealth, the capital market of that nation must efficiently allocate the available fund among the various industrial sectors. It is widely believed that the efficient capital allocation plays a major role in driving a nation’s economic growth. Taiwan has undergone dramatic changes in her industrial structure in the past ten years. Some industries experienced serious setback while others grew and prospered. It is of interest and importance to investigate the allocating role of the capital market during this period of time. In this thesis, we investigated the allocation efficiency of Taiwan’s capital market. Financial data of all the listed companies in the past ten years were collected. Two sets of hypotheses concerning the efficiency of the capital market were developed and tested. The first hypothesis investigates the dynamic behavior of capital allocation. The second hypothesis examined the phenomena in equilibrium state. The results of our study are as follows: First, the dynamic study showed that the capital was reasonably allocated among the various sectors in Taiwan. However, the allocation efficiency has deteriorated in the late 1990’s. Second, the study on equilibrium state showed that there is evidence of inefficiency on capital allocation during the period of time.