NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Cross-border Listings, Capital Controls, and Equity Flows To Emerging Markets

Hali J. Edison, Francis E. Warnock

NBER Working Paper No. 12589
Issued in October 2006
NBER Program(s):International Finance and Macroeconomics

We investigate the impact of two types of financial liberalizations on short- and long-horizon capital flows to emerging markets in a framework that controls for push and pull factors. The first type of liberalization, a reduction in capital controls, is countrywide but uncertain, because its extent and permanence is not known with certainty. The second type, a cross-border listing, is a firm-level liberalization that has no uncertainty. Consistent with theoretical predictions, we find that the deterministic cross-listing results in an immediate but short-lived increase in capital inflows. In contrast, the uncertain reduction in capital controls results in increased inflows only over a longer horizon, if at all.

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Document Object Identifier (DOI): 10.3386/w12589

Published: Edison, H., and F. Warnock, 2008. "Cross-Border Listings, Capital Controls, and Equity Flows to Emerging Markets." Journal of International Money and Finance 27: 1013-1027 citation courtesy of

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