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Cross-border listings, capital controls, and equity flows to emerging markets

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Author Info
Edison, Hali J.
Warnock, Francis E.

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Abstract

We investigate the impact of two types of financial liberalizations on short- and long-horizon capital flows to emerging markets in a framework that controls for push and pull factors. The first type of liberalization, a reduction in capital controls, is countrywide but uncertain, because its extent and permanence are not known with certainty. The second type, a cross-border listing, is a firm-level liberalization that has no uncertainty. Consistent with theoretical predictions, we find that the deterministic cross-listing results in an immediate but short-lived increase in capital inflows. In contrast, the uncertain reduction in capital controls results in increased inflows only over a longer horizon, if at all.

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Publisher Info
Article provided by Elsevier in its journal Journal of International Money and Finance.

Volume (Year): 27 (2008)
Issue (Month): 6 (October)
Pages: 1013-1027
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Handle: RePEc:eee:jimfin:v:27:y:2008:i:6:p:1013-1027

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Web page: http://www.elsevier.com/locate/inca/30443

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References listed on IDEAS
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Francis E. Warnock & Chad Cleaver, 2002. "Financial centers and the geography of capital flows," International Finance Discussion Papers 722, Board of Governors of the Federal Reserve System (U.S.). [Downloadable!]
  2. John M. Griffin & Federico Nardari & Rene M. Stulz, 2002. "Daily Cross-Border Equity Flows: Pushed or Pulled?," NBER Working Papers 9000, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. Lusine LUSINYAN, 2002. "International Capital Flows, Economic Growth and Financial Market Efficiency," Economics Working Papers ECO2002/20, European University Institute. [Downloadable!]
  4. Carol C. Bertaut, 2008. "Assessing the potential for further foreign demand for U.S. assets: Has financing U.S. current account deficits made foreign investors overweight in U.S. securities?," International Finance Discussion Papers 950, Board of Governors of the Federal Reserve System (U.S.). [Downloadable!]
  5. W. Christopher Walker & Maria Teresa Punzi, 2007. "Financing of Global Imbalances," IMF Working Papers 07/177, International Monetary Fund. [Downloadable!]
  6. Stephanie E. Curcuru & Tomas Dvorak & Francis E. Warnock, 2009. "Decomposing the U.S. External Returns Differential," NBER Working Papers 15077, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  7. Hali J. Edison & Francis E. Warnock, 2001. "A Simple Measure of the Intensity of Capital Controls," IMF Working Papers 01/180, International Monetary Fund. [Downloadable!]
    Other versions:
  8. Joël van der Weele, 2005. "Financing development: debt versus equity," DNB Working Papers 038, Netherlands Central Bank, Research Department. [Downloadable!]
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