Deep Financial Integration and Volatility / Sebnem Kalemli-Ozcan, Bent Sørensen, Vadym Volosovych.

Format:

Book

Author/Creator:

Kalemli-Ozcan, Sebnem.

Contributor:

National Bureau of Economic Research.

Sørensen, Bent.

Volosovych, Vadym.

Series:

Working Paper Series (National Bureau of Economic Research) no. w15900.

NBER working paper series no. w15900

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2010.

Summary:

We investigate the relationship between financial integration and output volatility at micro and macro levels. Using a very large firm-level dataset from EU countries over time, we construct a measure of "deep" financial integration at the regional level based on foreign ownership at the firm level. We find a positive effect of foreign ownership on volatility of firms' outcomes. This effect survives aggregation and carries over to regional output. Exploiting variation in the transposition dates of EU-wide legislation, we find that high trust regions in countries who harmonized capital markets sooner have higher levels of financial integration and volatility.

Notes:

Print version record

April 2010.