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The impact of macroeconomic variables, demographic structure and compulsory superannuation on share prices: the case of Australia

Author

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  • Wilson Huynh

    (School of Economics and Finance, University of Western Sydney, Penrith South DC, Australia)

  • Girijasankar Mallik

    (School of Economics and Finance, University of Western Sydney, Penrith South DC, Australia)

  • Samanthala Hettihewa

    (Faculty of Business Administration, Ontario, Canada)

Abstract

This paper investigates the impact of the population in the 40–64 age band on share prices, using an annual time series data set for the period 1965–2002, and the impact of the superannuation fund on share prices using quarterly time series data for the period 1988 Q1 to 2002 Q4. In accordance with Poterba's suggestion, we have also used real GDP, interest rates and inflation as control variables in both models. Using cointegration and the error correction mechanism we found that the specified models are robust. The variables under study for both models are cointegrated, and long-run relationships exist between the variables. We also found that the population in the 40–64 age band and the superannuation fund positively and significantly affect share prices separately in the long run. Journal of International Business Studies (2006) 37, 687–698. doi:10.1057/palgrave.jibs.8400220

Suggested Citation

  • Wilson Huynh & Girijasankar Mallik & Samanthala Hettihewa, 2006. "The impact of macroeconomic variables, demographic structure and compulsory superannuation on share prices: the case of Australia," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 37(5), pages 687-698, September.
    • Handle: RePEc:pal:jintbs:v:37:y:2006:i:5:p:687-698
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    Cited by:

    1. Jingoo Kang & Jeoung Yul Lee & Pervez N. Ghauri, 2017. "The Interplay of Mahalanobis Distance and Firm Capabilities on MNC Subsidiary Exits from Host Countries," Management International Review, Springer, vol. 57(3), pages 379-409, June.
    2. Hua Fan, John & Michalski, Lachlan, 2020. "Sustainable factor investing: Where doing well meets doing good," International Review of Economics & Finance, Elsevier, vol. 70(C), pages 230-256.
    3. Hettihewa, Samanthala & Saha, Shrabani & Zhang, Hanxiong, 2018. "Does an aging population influence stock markets? Evidence from New Zealand," Economic Modelling, Elsevier, vol. 75(C), pages 142-158.
    4. Hagigi, Moshe & Sivakumar, Kumar, 2009. "Managing diverse risks: An integrative framework," Journal of International Management, Elsevier, vol. 15(3), pages 286-295, September.
    5. Li, Wen & Guo, Bin & Xu, Gangxiang, 2017. "Making the next move: When does the newness of experience matter in overseas sequential entries of multinational companies?," International Business Review, Elsevier, vol. 26(5), pages 908-926.
    6. Apergis, Nicholas & Dastidar, Sayantan Ghosh, 2024. "Local stock liquidity and local factors: Fresh evidence from US firms across states," Research in International Business and Finance, Elsevier, vol. 67(PA).
    7. R. Ratneswary V. Rasiah, 2010. "Macroeconomic Activity And The Malaysian Stock Market: Empirical Evidence Of Dynamic Relations," The International Journal of Business and Finance Research, The Institute for Business and Finance Research, vol. 4(2), pages 59-69.

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