IDEAS home Printed from https://ideas.repec.org/a/oup/rcorpf/v13y2024i3p858-887..html
   My bibliography  Save this article

A Closer Look at the Effects of Equity Market Liberalization in Emerging Markets

Author

Listed:
  • R David McLean
  • Jeffrey Pontiff
  • Mengxin Zhao

Abstract

Earlier studies have linked equity market liberalization to growth in emerging markets. Some conclude liberalization causes growth, whereas others contend contemporaneous economic policies and conditions play important roles. The causal argument contends that foreigner investability in public firms leads to lower discount rates and greater share issuance, investment, and efficiency. Using three separate measures of foreign investability, we do not find these effects. Moreover, common de jure foreigner-investability measures are poor de facto measures. Economic indicators, not directly influenced by equity market liberalization, also grow faster in countries with more investable firms. Our findings suggest foreigner investability cannot fully explain the equity-market-liberalization-growth relation. (JEL F30, F38, G30, G24, G15)

Suggested Citation

  • R David McLean & Jeffrey Pontiff & Mengxin Zhao, 2024. "A Closer Look at the Effects of Equity Market Liberalization in Emerging Markets," The Review of Corporate Finance Studies, Society for Financial Studies, vol. 13(3), pages 858-887.
    • Handle: RePEc:oup:rcorpf:v:13:y:2024:i:3:p:858-887.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/rcfs/cfac023
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    JEL classification:

    • F30 - International Economics - - International Finance - - - General
    • F38 - International Economics - - International Finance - - - International Financial Policy: Financial Transactions Tax; Capital Controls
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

    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:oup:rcorpf:v:13:y:2024:i:3:p:858-887.. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Oxford University Press (email available below). General contact details of provider: https://academic.oup.com/rcfs .

    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.