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Global Market Dynamics: The Impact of Home Country Macro-Institutional Quality on NYSE-Listed Non-U.S. Stocks

Author

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  • Teressa Elliott

    (Haile College of Business, Northern Kentucky University, Highland Heights, KY, USA)

  • Jang-Chul Kim

    (Haile College of Business, Northern Kentucky University, Highland Heights, KY, USA)

  • Ha-Chin Yi

    (McCoy College of Business, Texas State University, San Marcos, TX, USA)

Abstract

We investigate liquidity and information asymmetry for a sample of non-U.S. stocks in the NYSE. Using the Worldwide Governance Indicators (WGI), we find that liquidity and information asymmetry measures for non-U.S. stock listings are significantly related to the macro-institutional quality of their home countries such as political risk and absence of violence/terrorism, government effectiveness, voice and accountability, control of corruption, and rule of law. We find non-U.S. stocks from countries with lower institutional quality metrics tend to have lower liquidity and higher information asymmetry. Therefore, improving the institutional quality of a country alleviates information problems and improves market liquidity for non-U.S. stocks listed on the NYSE.

Suggested Citation

  • Teressa Elliott & Jang-Chul Kim & Ha-Chin Yi, 2025. "Global Market Dynamics: The Impact of Home Country Macro-Institutional Quality on NYSE-Listed Non-U.S. Stocks," Review of Pacific Basin Financial Markets and Policies (RPBFMP), World Scientific Publishing Co. Pte. Ltd., vol. 28(02), pages 1-23, June.
    • Handle: RePEc:wsi:rpbfmp:v:28:y:2025:i:02:n:s0219091525500134
    DOI: 10.1142/S0219091525500134
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    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

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