Regulatory cooperation and foreign portfolio investment

• 成果类型: Article
• 署名作者: Lang, Mark; Maffett, Mark; Omartian, James D.; Silvers, Roger
• 署名单位: University of North Carolina; University of North Carolina Chapel Hill; University of Chicago; University of Michigan System; University of Michigan; Utah System of Higher Education; University of Utah
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2020.04.016
• 发表日期: 2020
• 页码: 138-158
• 关键词: Securities regulation; Foreign portfolio investment; Regulatory bonding

摘要

We investigate the effect of cross-border regulatory cooperation in the enforcement of securities laws on global-mutual-fund portfolio allocations. Our research design exploits a shock to the Securities and Exchange Commission's oversight of foreign firms cross-listed on a US stock exchange around the signing of the Multilateral Memorandum of Understanding (MMoU), a non-binding, information-sharing arrangement between global securities regulators. In signatory countries, foreign investment in US-cross-listed firms increases by $110 billion relative to non-cross-listed firms. The strongest effects are for investors facing greater information asymmetries, those from countries closely linked to the US, and non-US foreign investors, suggesting significant spillover effects from international regulatory cooperation. (C) 2020 Elsevier B.V. All rights reserved.