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The sequencing of stock market liberalization events and corporate financing decisions

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  • Flavin, Thomas
  • O'Connor, Thomas

Abstract

We examine the impact of stock market liberalization events on corporate financing choices. We analyze differences between 'investable' firms and those who cross-list on international markets and show that an initial act of liberalization evokes similar responses across all firms. Furthermore, we examine the importance of the order in which these events occur. We find evidence of different behavior depending on the sequence of events and across categories of listing. Level 3 ADRs confer greatest equity raising post-listing, suggesting that US lists still have benefits over and above London.

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Bibliographic Info

Article provided by Elsevier in its journal Emerging Markets Review.

Volume (Year): 11 (2010)
Issue (Month): 3 (September)
Pages: 183-204

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Handle: RePEc:eee:ememar:v:11:y:2010:i:3:p:183-204

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Web page: http://www.elsevier.com/locate/inca/620356

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Keywords: Financing choices Debt structure Investability Cross-listing;

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References

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  1. Nandini Gupta & Kathy Yuan, 2009. "On the Growth Effect of Stock Market Liberalizations," Review of Financial Studies, Society for Financial Studies, vol. 22(11), pages 4715-4752, November.
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  16. Henry, Peter Blair, 2000. "Do stock market liberalizations cause investment booms?," Journal of Financial Economics, Elsevier, vol. 58(1-2), pages 301-334.
  17. Enrica Detragiache & Gianni De Nicoló & Senay Agca, 2007. "Financial Reforms, Financial Openness, and Corporate Borrowing," IMF Working Papers 07/186, International Monetary Fund.
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Citations

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Cited by:
  1. Thomas O'Connor, 2012. "Legal bonding, investor recognition, and cross-listing premia in emerging markets," Economics, Finance and Accounting Department Working Paper Series n226-12.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  2. Thomas Flavin & Thomas O'Connor, 2013. "The effects of ownership structure on corporate financing decisions: Evidence from stock market liberalization," Economics, Finance and Accounting Department Working Paper Series n235-13.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  3. Kearney, Colm, 2012. "Emerging markets research: Trends, issues and future directions," Emerging Markets Review, Elsevier, vol. 13(2), pages 159-183.
  4. Buchanan, Bonnie G. & English II, Philip C. & Gordon, Rachel, 2011. "Emerging market benefits, investability and the rule of law," Emerging Markets Review, Elsevier, vol. 12(1), pages 47-60, March.

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