Is the relationship between macroeconomy and stock market liquidity mutually reinforcing? Evidence from an emerging market

2016 ◽  
Vol 9 (3) ◽  
pp. 294
Author(s):  
Ijaz Ur Rehman ◽  
Nurul Shahnaz Mahdzan ◽  
Rozaimah Zainudin
Keyword(s):  
Stock Market ◽  
Emerging Market ◽  
Market Liquidity ◽  
Stock Market Liquidity ◽  
The Relationship

Economic policy uncertainty and stock market liquidity

2018 ◽  
Vol 10 (1) ◽  
pp. 112-135 ◽  
Author(s):  
Byomakesh Debata ◽  
Jitendra Mahakud
Keyword(s):  
Economic Policy ◽  
Stock Market ◽  
Financial Crises ◽  
Emerging Market ◽  
Decomposition Analysis ◽  
Market Liquidity ◽  
Policy Uncertainty ◽  
Content Type ◽  
Economic Policy Uncertainty ◽  
Stock Market Liquidity

Purpose This study aims to examine the relationship between economic policy uncertainty and stock market liquidity in an order-driven emerging stock market. Design/methodology/approach Empirical estimates are based on vector autoregressive Granger-causality tests, impulse response functions and variance decomposition analysis. Findings The empirical findings suggest that economic policy uncertainty moderately influences stock market liquidity during normal market conditions. However, the role of economic policy uncertainty for determining stock market liquidity is significant in times of financial crises. The authors have also observed a significant portion of variation in stock market liquidity that is attributed to investor sentiments during financial crises. Originality/value This study is original in nature and provides evidence to consider economic policy uncertainty as a possible source of commonality in liquidity in the context of an emerging market.

scholarly journals State Antitakeover Laws and Voluntary Disclosure

2013 ◽  
Vol 48 (2) ◽  
pp. 637-668 ◽  
Author(s):  
Yijiang Zhao ◽  
Arthur Allen ◽  
Iftekhar Hasan
Keyword(s):  
Stock Market ◽  
Capital Market ◽  
Voluntary Disclosure ◽  
Driving Force ◽  
Market Liquidity ◽  
Stock Market Liquidity ◽  
Market Benefits ◽  
The Relationship

AbstractWe test the relationship between takeover protection and voluntary disclosure in a setting of antitakeover laws in a firm’s state of incorporation. After correcting for the endogeneity of firms’ incorporation choices, we find that firms incorporated in states with more antitakeover laws have higher levels of voluntary disclosure and stock market liquidity. Further tests do not support shareholder demands being the driving force for this association. Our findings are consistent with takeover protection and poor disclosure serving as substitute mechanisms for deterring takeovers. Therefore, as antitakeover statutes mitigate takeover threats, they enhance managers’ incentives to disclose more in order to realize capital market benefits.

scholarly journals Analysis of the Relationship between Monetary Policy and Stock Market Liquidity

2021 ◽  
Vol 4 (3) ◽  
pp. 25-27
Author(s):  
Feng Liang
Keyword(s):  
Monetary Policy ◽  
Stock Market ◽  
Financial Market ◽  
Market Liquidity ◽  
System Reform ◽  
Chinese Enterprises ◽  
Socialist Market Economy ◽  
Stock Market Liquidity ◽  
Effect Of Monetary Policy ◽  
The Relationship

After the 19th National Congress of the Chinese Communist Party, the introduction of the economic theory has promoted the integration of the global socialist market economy. Thereafter, this integration of the domestic and international market has been preliminarily completed, the role of the factor market in resource allocation has been improved, and a sturdy environment has been established for the development of Chinese enterprises. With the effective implementation of a series of policies after the financial system reform, the roles of the financial market in regulating macro-economy and revitalizing the market have become increasingly prominent. In regard to that, it has effectively promoted the financial market as a trade to “enrich people.” This paper analyzes the relationship between monetary policy and stock market liquidity in terms of the influence of the former on the latter and suggests strategies to enhance the liquidity effect of monetary policy.

Corporate Governance and Stock Market Liquidity

2016 ◽  
Vol 5 (3) ◽  
Author(s):  
Manjit Kaur Sidhu
Keyword(s):  
Corporate Governance ◽  
Stock Market ◽  
Information Disclosure ◽  
Market Liquidity ◽  
Manufacturing Companies ◽  
Governance Practices ◽  
Stock Market Liquidity ◽  
The Relationship ◽  
Corporate Information

Corporate governance has an impact on both quantity and quality of corporate information disclosure which affects the level of information asymmetry and thus impacts the changes in market liquidity of stock. This article attempts to discern the relationship between corporate governance and the stock market liquidity of Indian manufacturing companies included in the S&P BSE 100 Index during the period 2009-2012 by invoking pooled regression model. The empirical results support corporate governance implications of stock market liquidity as measured by Amivest measure (1985), that is, better governed companies has higher liquidity. The results of the present study are in support of arguments made by Chung, Elder, and Kim (2010), i.e., firms may improve stock market liquidity by adopting corporate governance practices that mitigate informational asymmetries.

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