TY  - JOUR
AU  - Bekaert, Geert
AU  - Harvey, Campbell R
TI  - Capital Flows and the Behavior of Emerging Market Equity Returns
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6669
PY  - 1998
Y2  - July 1998
DO  - 10.3386/w6669
UR  - http://www.nber.org/papers/w6669
L1  - http://www.nber.org/papers/w6669.pdf
N1  - Author contact info:
Geert Bekaert
Graduate School of Business
Columbia University
3022 Broadway, 411 Uris Hall
New York, NY 10027
Tel: 212/854-9156
Fax: 212/662-8474
E-Mail: gb241@columbia.edu

Campbell R. Harvey
Duke University
Fuqua School of Business
Durham, NC 27708-0120
Tel: 919/660-7768
Fax: 919/660-8030
E-Mail: cam.harvey@duke.edu
M1  - published as Geert Bekaert, Campbell R. Harvey. "Capital Flows and the Behavior of Emerging Market Equity Returns," in Sebastian Edwards, editor, "Capital Flows and the Emerging Economies: Theory, Evidence, and Controversies" University of Chicago Press (2000)

AB  - Foreign portfolio flows may reflect deep changes in the functioning of an emerging market economy and its capital markets.  Using a database of monthly net U.S. equity flows, we investigate the relation of these flows to the behavior of equity returns, the structural characteristics of the capital markets, exchange rates, and the strength of the economy.  We find that increases in equity flows are associated with a lower cost of capital, higher correlation with world market returns, lower asset concentration, lower inflation, larger market size relative to GDP, more trade, and slightly higher per capita economic growth.
ER  -