North Africa Liquidity Constructs BH R&R JIFMIM (1).pdf (848.26 kB)
The political institutional and firm governance determinants of liquidity: evidence from North Africa and the Arab Spring
journal contribution
posted on 2023-06-08, 23:39 authored by Bruce HearnThis study undertakes a unique comparison into the relative efficacy of four well established liquidity measures, namely turnover, proportion of daily zero returns, Amihud (2002) and Liu (2006), in explaining the bid-ask spread plus brokerage costs when powerful and common firm governance mechanisms are taken into account as controls. These are representative of ownership of listed firms by state, long term foreign partners, entrepreneurial founders, single family entities, extended family groups and business networks, domestic and foreign venture capitalists. An additional control for firms within business network controlled by former Tunisian premier, Ben Ali, and Morocco's royal family is also included. Using a unique sample of all listed firms across the equity markets of Egypt, Morocco, Tunisia and Algeria I find evidence of equity capital rationing during the Arab Spring period of political upheaval. Less well regulated SME markets such as Morocco's marche croissance have liquidity-based transactions costs attributable to Arab Spring four times those of the marche principal while those in Egypt's Nilex are twenty times those of the prestigious EGX30 index. Finally the greatest changes in political risks associated with aggregate liquidity across the Arab Spring are democratic accountability, military in politics, and law and order.
History
Publication status
- Published
File Version
- Accepted version
Journal
Journal of International Financial Markets, Institutions and MoneyISSN
1042-4431Publisher
ElsevierExternal DOI
Volume
31Page range
127-158Department affiliated with
- Business and Management Publications
Full text available
- Yes
Peer reviewed?
- Yes
Legacy Posted Date
2015-12-04First Open Access (FOA) Date
2016-10-26First Compliant Deposit (FCD) Date
2016-10-26Usage metrics
Categories
No categories selectedLicence
Exports
RefWorks
BibTeX
Ref. manager
Endnote
DataCite
NLM
DC