Capital Account Liberalization: Allocative Efficiency or Animal Spirits?
نویسندگان
چکیده
In the year that capital-poor countries open their stock markets to foreign investors, the growth rate of their typical firm’s capital stock exceeds its pre-liberalization mean by 4.1 percentage points. In each of the next three years the average growth rate of the capital stock for the 369 firms in the sample exceeds its pre-liberalization mean by 6.1 percentage points. However, there is no evidence that differences in the liberalizationinduced changes in the cost of capital or investment opportunities drive the crosssectional variation in the post-liberalization investment increases.
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