Financial Development and the Sensitivity of Stock Markets to External Influences
AbstractWe investigate how the relative contribution of external factors to stock price movements varies with the degree of financial development. We find that financial development makes stock markets more susceptible to external influences (both financial and macroeconomic). Interestingly, this effect is present even after having accounted for capital controls and international trade effects.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2766.
Date of creation: Apr 2001
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Other versions of this item:
- Dellas, Harris & Hess, Martin K, 2002. "Financial Development and the Sensitivity of Stock Markets to External Influences," Review of International Economics, Wiley Blackwell, vol. 10(3), pages 525-38, August.
- Harris Dellas & Martin K. Hess, 2000. "Financial Development and the Sensitivity of Stock Markets to External Influences," Working Papers 00.06, Swiss National Bank, Study Center Gerzensee.
- F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
- G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
- O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
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