Global Growth Opportunities and Market Integration
We measure a countrys growth opportunities by investigating how its industry mix is priced in global capital markets, using price earnings ratios of global industry portfolios. First, we find that these exogenous growth opportunities strongly predict future changes in real GDP and investment in a large panel of countries. This relation is strongest in countries that have liberalized their capital accounts, equity markets, and banking systems. Second, we re-examine the link between financial development, investor protection, capital allocation, and growth. We find that financial development and investor protection measures are much less important in aligning growth oppor- tunities with growth than is capital market openness. Third, we formulate new tests of market integration and segmentation. Under integration, the difference between a countrys local PE ratio and its global counterpart should not predict relative growth, but the difference between its exogenous global PE ratio and the world market PE ratio should predict relative growth.
Growth Opportunities Market Integration Finance and Growth Capital Allocation Capital Account Openness Financial Liberalization
Geert Bekaert Campbell R. Harvey Christian Lundblad Stephan Siegel
Columbia University, New York, NY 10027 USA National Bureau of Economic Research, Cambridge, MA 0213 Duke University, Durham, NC 27708 USA National Bureau of Economic Research, Cambridge, MA 02138 USA Indiana University, Bloomington, IN 47405 USA Columbia University, New York, NY 10027 USA
国际会议
西安
英文
1-47
2006-07-17（万方平台首次上网日期，不代表论文的发表时间）