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Cross-border Listings, Capital Controls, and Equity Flows To Emerging Markets

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Author Info
Hali J. Edison
Francis E. Warnock

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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 is 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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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 12589.

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Date of creation: Oct 2006
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Handle: RePEc:nbr:nberwo:12589

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Find related papers by JEL classification:
F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
F3 - International Economics - - International Finance
G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

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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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