Showing papers by "Martin Hess published in 2001"
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TL;DR: The authors investigated how the relative contribution of external factors to stock price movements varies with the degree of financial development and found that financial development makes stock markets more susceptible to external influences (both financial and macroeconomic).
Abstract: We investigate how the relative contribution of external factors to stock price movements varies with the degree of financial development. We find that financial development makes stock markets more susceptible to external influences (both financial and macroeconomic). Interestingly, this effect is present even after having accounted for capital controls and international trade effects.
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