Abstract

http://ssrn.com/abstract=1533163
 
 

References (22)



 
 

Citations (44)



 


 



Short-Selling Bans Around the World: Evidence from the 2007-09 Crisis


Alessandro Beber


Cass Business School; Centre for Economic Policy Research (CEPR)

Marco Pagano


University of Naples Federico II - Department of Economics and Statistics; Einaudi Institute for Economics and Finance (EIEF); Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

November 2009

CEPR Discussion Paper No. DP7557

Abstract:     
Most stock exchange regulators around the world reacted to the financial crisis of 2007-2009 by imposing bans or regulatory constraints on short-selling by market participants. We use the large amount of evidence generated by these regime changes to investigate their effects on liquidity, price discovery and stock returns. Since bans were enacted and lifted at different dates in different countries, and in some countries applied to financial stocks only, we identify their effects with panel data techniques, and find that bans (i) were detrimental for liquidity, especially for stocks with small market capitalization and high volatility; (ii) slowed down price discovery, especially in bear market phases, and (iii) failed to support stock prices.

Number of Pages in PDF File: 41

Keywords: ban, crisis, liquidity, price discovery, short selling

JEL Classification: G01, G12, G14, G18

working papers series


Date posted: January 11, 2010  

Suggested Citation

Beber, Alessandro and Pagano, Marco, Short-Selling Bans Around the World: Evidence from the 2007-09 Crisis (November 2009). CEPR Discussion Paper No. DP7557. Available at SSRN: http://ssrn.com/abstract=1533163

Contact Information

Alessandro Beber (Contact Author)
Cass Business School ( email )
London, EC2Y 8HB
Great Britain
Centre for Economic Policy Research (CEPR) ( email )
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Marco Pagano
University of Naples Federico II - Department of Economics and Statistics ( email )
Via Cintia - Monte S. Angelo
Napoli, 80126
Italy
+39 081 675306 (Phone)
+39 081 7663540 (Fax)
Einaudi Institute for Economics and Finance (EIEF)
Via Sallustiana, 62
Rome, 00187
Italy
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
European Corporate Governance Institute (ECGI)
c/o ECARES ULB CP 114
B-1050 Brussels
Belgium
HOME PAGE: http:/www.ecgi.org
Feedback to SSRN


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References:  22
Citations:  44

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