Abstract
This paper examines the impact of financial liberalization on emerging capital market in the context of China. We control for time-invariant firm fixed effects and employ lagged firm size and ownership structure as instrumental variables for the shareholdings of institutional investors. The results indicate that foreign institutional investors reduce volatility and act as market stabilizers. In contrast, domestic institutional investors exacerbate stock market fluctuation.
| Original language | English |
|---|---|
| Pages (from-to) | 73-75 |
| Number of pages | 3 |
| Journal | Economics Letters |
| Volume | 136 |
| DOIs | |
| State | Published - 1 Nov 2015 |
Keywords
- Financial liberalization
- Foreign Institutional Investor
- Volatility
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