Financial Development and Stock Returns: A Cross-Country Analysis

Harris Dellas () and Martin Hess

No 3681, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We examine stock returns in a cross section of emerging and mature markets (47countries) between 1980-99. The level of financial development turns out to be an important determinant of the performance of stock returns. In general, a deeper and higher quality banking system decreases the volatility of stock returns. It also contributes to a greater synchronization in the movements of domestic and world returns and the same obtains when the stock market is liquid.

Keywords: Financial development; Stock returns (search for similar items in EconPapers)
JEL-codes: G15 O10 (search for similar items in EconPapers)
Date: 2002-01
New Economics Papers: this item is included in nep-cfn, nep-fin, nep-fmk, nep-mfd and nep-rmg
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Citations: View citations in EconPapers (1)

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Journal Article: Financial development and stock returns: A cross-country analysis (2005)
Working Paper: Financial development and stock returns: A cross country analysis (2002)
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