IDEAS home Printed from https://ideas.repec.org/a/bla/jfnres/v28y2005i3p421-437.html
   My bibliography  Save this article

Can Stock Market Liberalization In Emerging Economies Mitigate Legal Systems Deficiencies?

Author

Listed:
  • Wi Saeng Kim
  • Esmeralda Lyn
  • Edward J. Zychowicz

Abstract

We document positive valuation effects around the time of stock market liberalization. We find that the valuation effects are larger for countries with civil law traditions compared with countries with common law origins. Similarly, we find that countries with weaker shareholder protections exhibit greater market valuation increases compared with countries with stronger shareholder protections. The results reinforce the importance of country legal systems and of shareholder protections in determining the quality of corporate governance systems and financial market outcomes. The findings suggest that stock market liberalization may mitigate deficiencies in the existing institutional environments not supportive of effective corporate governance systems.

Suggested Citation

  • Wi Saeng Kim & Esmeralda Lyn & Edward J. Zychowicz, 2005. "Can Stock Market Liberalization In Emerging Economies Mitigate Legal Systems Deficiencies?," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 28(3), pages 421-437, September.
    • Handle: RePEc:bla:jfnres:v:28:y:2005:i:3:p:421-437
    DOI: 10.1111/j.1475-6803.2005.00132.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1475-6803.2005.00132.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1475-6803.2005.00132.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Federico Bonaglia & Jorge Braga de Macedo & Maurizio Bussolo, 2009. "How Globalisation Improves Governance," Chapters, in: Linda Yueh (ed.), The Law and Economics of Globalisation, chapter 7, Edward Elgar Publishing.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Aggarwal, Raj & Goodell, John W., 2009. "Markets versus institutions in developing countries: National attributes as determinants," Emerging Markets Review, Elsevier, vol. 10(1), pages 51-66, March.
    2. Narjess Boubakri & Jean‐Claude Cosset & Houcem Smaoui, 2009. "Does Privatization Foster Changes In The Quality Of Legal Institutions?," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 32(2), pages 169-197, June.
    3. Jia, Qiaoyu & Zhou, Jia'nan, 2021. "The dark side of stock market liberalization: Perspectives from corporate R&D activities in China," The North American Journal of Economics and Finance, Elsevier, vol. 58(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Doidge, Craig & Andrew Karolyi, G. & Stulz, Rene M., 2007. "Why do countries matter so much for corporate governance?," Journal of Financial Economics, Elsevier, vol. 86(1), pages 1-39, October.
    2. Voxi Amvilah & Simplice Anutechia Asongu & Antonio Andrés, 2014. "Globalization, Peace & Stability, Governance, and Knowledge Economy," AAYE Policy Research Working Paper Series 14_024, Association of African Young Economists, revised Dec 2014.
    3. repec:spo:wpecon:info:hdl:2441/10184 is not listed on IDEAS
    4. Thierry Mayer, 2006. "Policy Coherence for Development: A Background Paper on Foreign Direct Investment," OECD Development Centre Working Papers 253, OECD Publishing.
    5. Henri Atangana ondoa, 2014. "The determinants of corporate corruption in Cameroon," Economics Bulletin, AccessEcon, vol. 34(2), pages 938-950.
    6. Jorge Braga de Macedo, 2012. "Cape Verde’s foreign policy: an economic perspective," Nova SBE Working Paper Series wp572, Universidade Nova de Lisboa, Nova School of Business and Economics.
    7. Amavilah, Voxi & Asongu, Simplice A. & Andrés, Antonio R., 2017. "Effects of globalization on peace and stability: Implications for governance and the knowledge economy of African countries," Technological Forecasting and Social Change, Elsevier, vol. 122(C), pages 91-103.
    8. Lalountas, Dionisios A. & Manolas, George A. & Vavouras, Ioannis S., 2011. "Corruption, globalization and development: How are these three phenomena related?," Journal of Policy Modeling, Elsevier, vol. 33(4), pages 636-648, July.
    9. Aisha Ismail & Kashif Rashid, 2014. "Time series analysis of the nexus among corruption, political instability and judicial inefficiency in Pakistan," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(5), pages 2757-2771, September.
    10. Nadeem, Muhammad & Hayat, Muhammad Azmat & Nazir, Rabia, 2014. "Exploring Interlinks between Globalization and Governance: A Panel Data Evidence," MPRA Paper 61334, University Library of Munich, Germany.
    11. Pınar ÇUHADAR & Ömer DORU, 2020. "Institutions and International Trade Linkages: An Investigation with Panel Data Analysis on Transition Economies Abstract: The purpose of the paper is to analyze the impact of governance indicator as ," Sosyoekonomi Journal, Sosyoekonomi Society, issue 28(45).
    12. Simplice A. Asongu & Joseph Nnanna, 2021. "Globalization, Governance, and the Green Economy in Sub‐Saharan Africa: Policy Thresholds," World Affairs, John Wiley & Sons, vol. 184(2), pages 176-212, June.
    13. Marc Audi & Amjad Ali, 2019. "Exploring the Linkage between Corruption and Economic Development in The Case of Selected Developing and Developed Nations," International Journal of Economics and Financial Issues, Econjournals, vol. 9(4), pages 37-49.
    14. Bacchetta, Marc & Drabek, Zdenek, 2002. "Effects of WTO accession on policy-making in sovereign states: Preliminary lessons from the recent experience of transition countries," WTO Staff Working Papers DERD-2002-02, World Trade Organization (WTO), Economic Research and Statistics Division.
    15. Thomas M. Fitzpatrick, 2009. "The Social And Economic Impact Of Corruption On Nations And Multinational Corporations," JOURNAL STUDIA UNIVERSITATIS BABES-BOLYAI NEGOTIA, Babes-Bolyai University, Faculty of Business.
    16. Fathi Ali & Norbert Fiess & Ronald Macdonald, 2011. "Climbing To The Top? Foreign Direct Investment And Property Rights," Economic Inquiry, Western Economic Association International, vol. 49(1), pages 289-302, January.
    17. Mukherjee, Deepraj, 2015. "Did pre-WTO agreements curb corruption?," Economic Analysis and Policy, Elsevier, vol. 47(C), pages 1-10.
    18. Zdenek Drabek & Marc Bacchetta, 2004. "Tracing the Effects of WTO Accession on Policy‐making in Sovereign States: Preliminary Lessons from the Recent Experience of Transition Countries," The World Economy, Wiley Blackwell, vol. 27(7), pages 1083-1125, July.
    19. Aida Isabel Tavares, 2004. "The socio-cultural and political-economic causes of corruption: a cross-country analysis," Working Papers de Economia (Economics Working Papers) 19, Departamento de Economia, Gestão e Engenharia Industrial, Universidade de Aveiro.
    20. Spagnolo, Giancarlo, 2002. "Globalization and Cooperative Relations," CEPR Discussion Papers 3522, C.E.P.R. Discussion Papers.
    21. Cuneyt Koyuncu & Rasim Yilmaz, 2013. "Deforestation, corruption, and private ownership in the forest sector," Quality & Quantity: International Journal of Methodology, Springer, vol. 47(1), pages 227-236, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jfnres:v:28:y:2005:i:3:p:421-437. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/sfaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.