Essays in international finance
Miletkov, Mihail Krassimirov
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The dissertation explores two key issues in international nance: the liberalization of the national stock markets and the protection of the minority shareholders. In the rst essay we document that both political and economic factors in uence the government's decision whether and when to allow foreign investors to purchase domestic equity securities. Among the economic factors, the level of nancial development, the structure of the economy, the level of investor protection, and the level of the government's involvement in the economy are signi cant determinants of the stock market liberalization decision. The signi cant political factors include the government's political orientation and the in uence of foreign governments and agencies through the allocation of foreign nancial aid. In the second essay we examine the e ect of the presence of the government as a minority shareholder on the protection of the minority shareholders in privatized rms. Consistent with the government's incentive to foster security market development and to enlist the support of the median-class voters for the privatization process we nd that the government e ectively monitors the controlling shareholders in the newly privatized rms and curbs their ability to expropriate the minority shareholders.