Biases in international portfolio allocation and investor protection standards |
| |
| Affiliation: | 1. Department of Accounting and Finance, De Montfort University, England LE2 7BY, United Kingdom;2. Department of Accounting and Finance, University of Strathclyde, Scotland G4 0LN, United Kingdom;1. De Nederlandsche Bank, Westeinde 1, Amsterdam 1017 ZN, the Netherlands;2. University of Amsterdam, Roetersstraat 11, Amsterdam 1018 WD, the Netherlands;1. Department of Finance, Tunghai University, Taichung, Taiwan;2. Beedie School of Business, Simon Fraser University, Vancouver, BC, Canada;1. Farmer School of Business, Miami University, Oxford, OH 45056, United States;2. Culverhouse College of Commerce, University of Alabama, Tuscaloosa, AL 35487-0224, United States |
| |
| Abstract: | Economic reasoning suggests that financial globalization that encourages optimal international portfolio investments should improve investor protection standards (IPS) of a country. In practice, however, investors manifest varying degrees of suboptimal international portfolio allocations. Using a panel dataset covering 44 countries spanning over 15 years we examine whether suboptimal equity portfolio allocation in part is associated with the cross-country variations in IPS. Consistent with economic reasoning we find robust indications that international portfolio allocation may play an important role in the development of IPS. More specifically, the quality of IPS improves with higher degrees of optimal international equity portfolio allocation of domestic and foreign investors. |
| |
| Keywords: | |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
