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Financial Markets and Politics: The Piñera Effect on the Chilean Capital Market


  • Claudio Bonilla
  • Harold Contreras
  • Jean Sepúlveda


The 2010 presidential election in Chile marked a change from the center-left coalition that governed the country for twenty years to a center-right coalition led by politician and businessman Sebastian Piñera. We study the effect that Piñera's presidential campaign had on the Chilean capital market. By using a panel of forty-nine companies during a period of thirteen months prior to the election, we find that there was a positive and significant effect on the capital market because of the expectation that Piñera would be elected president. That expectation continued throughout the entire presidential campaign.

Suggested Citation

  • Claudio Bonilla & Harold Contreras & Jean Sepúlveda, 2014. "Financial Markets and Politics: The Piñera Effect on the Chilean Capital Market," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 50(S1), pages 121-133.
  • Handle: RePEc:mes:emfitr:v:50:y:2014:i:s1:p:121-133
    DOI: 10.2753/REE1540-496X5001S108

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    Cited by:

    1. Brzeszczyński, Janusz & Gajdka, Jerzy & Kutan, Ali M., 2015. "Investor response to public news, sentiment and institutional trading in emerging markets: A review," International Review of Economics & Finance, Elsevier, vol. 40(C), pages 338-352.

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