Sunwoo Hwang

I am an Assistant Professor of Finance at Korea University Business School (KUBS). My research interests lie in the areas of corporate finance, which include labor finance, entrepreneurial finance, and environment, social, and governance (ESG).

Email: sunwoo_hwang(at)korea.ac.kr

SSRN / Google Scholar

Curriculum Vitae

I co-organize the K virtual finance seminar (link).

In June 2025, I will travel to Rotterdam, Netherlands, and Alghero, Italy, to present "Time to Innovate."

Research assistant opportunities:
Students interested in gaining hands-on experience in academic research in financial economics are welcome to contact me via email to discuss the details. There are opportunities across diverse subtopics, including gig economy, open banking, climate risk, gender economics, and consumer finance. Current projects utilize cutting-edge datasets from Korea, including proprietary data on credit card spending by consumers and small businesses, tax-filing-based transaction data between millions of businesses, scope 1/2/3 carbon emission data (under construction), patent data, and employee-employer-matched panel data.

Working Papers

Time to Innovate with Sooji Kim

Abstract: We leverage Korea's 52-hour workweek law and a regression discontinuity design to show the positive impact of reduced labor time on corporate innovation. Effective July 2018, the law leads to an immediate fall in working hours and a rise in innovation output by the end of 2019, only in light manufacturing, a sector heavily reliant on labor-driven innovation. This effect is attributed to suboptimal pre-law time allocation, as evidenced by the lack of significant changes in output, labor input, and capital input. It is more pronounced in establishments where innovation incentives complement increased non-labor time and less so in those where other forms of slack serve as substitutes. The pre-law suboptimality is explained by structural inertia and not by agency conflicts.

Labor-Management Relational Capital with Biwon Lee

Abstract: Using novel survey data from randomly selected establishments, which include common questions posed to employees and management about their relationship, we show that good labor relations enhance profitability, labor productivity, and employee retention. We measure relational quality by comparing employee responses to those of management and leverage its within-stratum-year variation, which is random conditional on covariate and outcome balances, to predict outcomes in the following survey year. Neither employee nor management responses alone predict outcomes, implying the importance of assessing bilateral ESG factors, such as labor relations, with input from both parties. The results are pronounced in establishments with lower relational quality and those offering job training to rank-and-file employees.

Indirect Employment and Innovation

Abstract: Using novel data on indirect employment (IE) and a Supreme Court ruling against it, I show that IE of skilled labor reduces corporate innovation. After the ruling-induced integration of indirectly hired skilled workers into the boundaries of their users, establishments with greater pre-ruling reliance on these workers innovate more compared to those with lesser reliance. This effect is conditional on compensation schemes that reward employees' investment in firm-specific skills and long-term performance. It is attributed to the support provided by former indirect employees to existing inventors and occurs without increased R&D spending or capital intensity thanks to low integration costs.
Featured in University of Cambridge Judge Business School's News & Insight (Link)

Mandating Women on Boards: Evidence from the United States with Anil Shivdasani and Elena Simintzi

Abstract: On September 30, 2018, California became the first U.S. state to set quotas for women directors on corporate boards. The law resulted in a decline in shareholder value for firms headquartered in California. This decline increases with the number of female directors required to be added under these quotas. We find evidence that supply-side constraints drive the announcement effects. The law expanded the supply of women in the director pool. Female directors appointed to meet the quotas are as skilled as male directors, but possess a less similar set of skills and are given fewer responsibilities on the board.
Featured in Harvard Law School's Forum on Corporate Governance and Financial Regulation (Link)

Revealed Board Non-Independence

Abstract: Decades of research on corporate boards have wrestled with the issue that board composition is endogenously determined by the CEO and a board and relays incomplete information about board independence. This paper establishes that there exist circumstances under which the CEO reveals the private information she has made a board non-independent and that her decision constitutes perfect Bayesian equilibria. Further, the paper shows that the revelation is followed by a sharp decline in firm value and board monitoring quality. The results are stronger for firms in a poor information environment. Tests based on sudden director deaths suggest the evidence is causal.

Publications

Does Diversification of Share Classes Increase Firm Value? with Sojung Kim and Woochan Kim, 2020, Asian Review of Financial Research

When Heirs Become Major Shareholders: Evidence on Pyramiding Financed by Related-Party Sales with Woochan Kim, 2016, Journal of Corporate Finance

Managerial Entrenchment of Anti-Takeover Devices: Quasi-Experimental Evidence from Korea with Woochan Kim, 2012, Pacific-Basin Finance Journal

Teaching

Korea University Business School

Financial Management (undergraduate), 2021-Present
Corporate Finance (undergraduate, syllabus), 2021-Present
Corporate Finance I (graduate, syllabus), 2023-Present
Independent Research (Finance MBA), 2023-Present
Seminar in Finance (graduate), 2021-2024
Entrepreneurial Finance (KMBA special lecture), Winter 2023

University of North Carolina at Chapel Hill, Kenan-Flagler Business School

Corporate Finance (undergraduate), Summer 2017

Writings

The Rise of the Special Purpose Acquisition Company

Media

"South Korea has had enough of being called an emerging market," Economist, June 2023