Why invest in invester protection? New evidences from ADR market.
Date of Issue2006
College of Business (Nanyang Business School)
The purpose of this study is to examine the effects of cross-sectional differences in the level of investor protection across different countries on the firm liquidity, cost of equity and valuation. I analyze 251 firms from 26 different countries listed as ADRs in US as on June 30, 2002. I find that the country-level investor protection has a strong impact on all three stock-related variables.
Nanyang Technological University