TY - JOUR
T1 - On the fortunes of stock exchanges and their reversals
T2 - evidence from foreign listings
AU - Fernandes, Nuno
AU - Giannetti, Mariassunta
N1 - Funding Information:
We are grateful to an anonymous referee, José Manuel Campa, François Degeorge, Christian Fons-Rosen, Ulrich Hege, Marco Pagano, Hong Yan, Mike Weisbach, and seminar participants at the ESSEC Private Equity Conference, Wharton/SIFR/Tsinghua Conference on Emerging Market Finance, the Conference on Corporate Governance in Emerging Markets (São Paulo), the Workshop on Corporate Governance at Copenhagen Business School, the Madrid Finance Workshop on Corporate Finance, Stockholm School of Economics, BI Norwegian School of Management, Bocconi University, University of Zurich, the Shanghai Advanced Institute of Finance, and Foro de Finanzas (Barcelona) for comments. Fernandes gratefully acknowledges financial support from the European Central Bank, under the Lamfalussy Fellowship Program. Giannetti gratefully acknowledges financial support from the Bank of Sweden Tercentenary Foundation and Centro Paolo Baffi at Bocconi University. The views expressed in this paper are those of the authors and do not necessarily reflect the views of the ECB, the Eurosystem, or its staff.
Copyright:
Copyright 2014 Elsevier B.V., All rights reserved.
PY - 2014/4
Y1 - 2014/4
N2 - Using a sample that provides unprecedented detail on foreign listings for 29 exchanges in 24 countries starting from the early 1980s, we show that although firms list in countries with better investor protection, they are less likely to list in countries with excessively stronger investor protection. We provide evidence based on ex ante firm and market characteristics and ex post listing outcomes that our findings are due to lack of investor interest in firms from environments with much weaker investor protection. We also argue that our findings, together with a general trend of improvement in investor protection in many firms' countries of origin, can explain why US and UK exchanges have attracted an increasing number of foreign listings during our sample period.
AB - Using a sample that provides unprecedented detail on foreign listings for 29 exchanges in 24 countries starting from the early 1980s, we show that although firms list in countries with better investor protection, they are less likely to list in countries with excessively stronger investor protection. We provide evidence based on ex ante firm and market characteristics and ex post listing outcomes that our findings are due to lack of investor interest in firms from environments with much weaker investor protection. We also argue that our findings, together with a general trend of improvement in investor protection in many firms' countries of origin, can explain why US and UK exchanges have attracted an increasing number of foreign listings during our sample period.
KW - Cross-listings
KW - Investor interest
KW - Investor protection
UR - http://www.scopus.com/inward/record.url?scp=84898403659&partnerID=8YFLogxK
U2 - 10.1016/j.jfi.2013.04.005
DO - 10.1016/j.jfi.2013.04.005
M3 - Article
AN - SCOPUS:84898403659
SN - 1042-9573
VL - 23
SP - 157
EP - 176
JO - Journal of Financial Intermediation
JF - Journal of Financial Intermediation
IS - 2
ER -