The Role of Pension Funds in Capital Market Development
AbstractThis paper provides an investigation of the impacts of pension funds on capital market development, both for stock markets and bond markets. For the overall sample of countries, we find that pension fund financial assets have positive impacts on stock market depth and liquidity as well as private bond market depth. However, when we split the countries into two groups according to their level of financial development, the impacts are only significant for countries with „high‟ financial development. Pension funds do not impact capital market development in the countries with a „low‟ level of financial development. These findings are based on a biased-corrected Least Square Dummy Variables (LSDVC) estimator. The results suggest that countries with 'low' financial development should reconsider the management approach and investment strategies for their pension funds.
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Bibliographic InfoPaper provided by National Graduate Institute for Policy Studies in its series GRIPS Discussion Papers with number 10-17.
Length: 20 pages
Date of creation: Oct 2010
Date of revision:
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Web page: http://www.grips.ac.jp/r-center/en/discussion_papers/
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Find related papers by JEL classification:
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
- G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
- H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
- G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-30 (All new papers)
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.:
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