How institutional development news moves an emerging market

Alexander Guzmán, Vikas Mehrotra, Randall Morck and María-Andrea Trujillo

Journal of Business Research, 2020, vol. 112, issue C, 300-319

Abstract: Major moves in Colombia’s stock market in the 2000s correspond to major news of progress or setbacks in rebuilding the country’s institutions, shattered by widespread guerrilla insurgencies in the 1990s. This contrasts with prior work reporting no news on major market moves in the US, a country with comparatively stable institutions. Colombian economy-level news during the institutional rebuilding phase may have been exceptionally economically significant. This suggests that stock market moves might usefully gauge the importance of institutional changes in other developing economies.

Keywords: Market efficiency; Noise trading; Institutions; Economic development (search for similar items in EconPapers)
JEL-codes: G14 G41 N26 O43 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:112:y:2020:i:c:p:300-319

DOI: 10.1016/j.jbusres.2019.10.009

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