Privatization and Financial Market Development in Emerging Countries: A Comparative Study

23 Pages Posted: 18 Feb 2010 Last revised: 9 Jul 2010

See all articles by Sami Ben Naceur

Sami Ben Naceur

International Monetary Fund (IMF)

Narjess Boubakri

American University of Sharjah - School of Business and Management; HEC Montreal - Department of Finance

Samir Ghazouani

Higher School of Statistics and Information Analysis (ESSAI)

Date Written: March 1, 2009

Abstract

This paper examines the impact of privatization on stock market size and liquidity in a multinational sample of 31 emerging markets. We find that the intensity of privatization and the use of privatization offerings on the stock market contribute to enhance stock market development (market capitalization and value traded), but the documented effects vary across geographical regions, owing to the specificities of the divestiture process. We use GMM procedure in order to estimate dynamic panel specifications and find that privatization appears to be the most beneficial in the Asian sub sample where most favourable conditions were put in place before privatization actually started. In other regions however, similar positive outcomes are yet to materialize. We derive several policy implications from our results.

Keywords: Privatization, Stock market development

JEL Classification: G15, G18

Suggested Citation

Ben Naceur, Sami and Boubakri, Narjess and Ghazouani, Samir, Privatization and Financial Market Development in Emerging Countries: A Comparative Study (March 1, 2009). Available at SSRN: https://ssrn.com/abstract=1554528 or http://dx.doi.org/10.2139/ssrn.1554528

Sami Ben Naceur (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Narjess Boubakri

American University of Sharjah - School of Business and Management ( email )

P.O. Box 26666
Sharjah
United Arab Emirates

HOME PAGE: http://www.aus.edu

HEC Montreal - Department of Finance ( email )

3000 Chemin de la Cote-Sainte-Catherine
Montreal, Quebec H3T 2A7
Canada

Samir Ghazouani

Higher School of Statistics and Information Analysis (ESSAI) ( email )

6, Rue des métiers
Charguia II, 2035
Tunisia
+216 70 839 440 (Phone)
+216 70 838 170 (Fax)

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
201
Abstract Views
1,122
rank
162,042
PlumX Metrics