European Financial Markets - The Effects of European Union Membership on Central and Eastern European Equity Markets

EU membership involves political and economic reforms
which influence financial markets in the new member states.
This study empirically explores and quantifies the effects of
EU accession on the risk and return of equity markets in eight
Central and Eastern European markets joining the EU in 2004.
The study also incorporates a review of how the influence of
macroeconomic variables and the level of integration with
global and European markets change as a result of
EU membership.
Based on empirical tests using weekly data over ten years,
this study concludes that EU membership results in a
significant decline in equity market volatility and a
significant increase in risk-adjusted, but not absolute,
equity returns. Furthermore, the study suggests that equity
markets in new EU member states become increasingly
influenced by global rather than local macroeconomic
factors after the EU accession and that the level of integration
with global markets increases.

List of contents

Literature Review.- Definition of Research Questions and Hypotheses.- Methodology.- Review of Empirical Data.- Findings and Discussion.- Conclusions.

Summary

EU membership involves political and economic reforms
which influence financial markets in the new member states.
This study empirically explores and quantifies the effects of
EU accession on the risk and return of equity markets in eight
Central and Eastern European markets joining the EU in 2004.
The study also incorporates a review of how the influence of
macroeconomic variables and the level of integration with
global and European markets change as a result of
EU membership.
Based on empirical tests using weekly data over ten years,
this study concludes that EU membership results in a
significant decline in equity market volatility and a
significant increase in risk-adjusted, but not absolute,
equity returns. Furthermore, the study suggests that equity
markets in new EU member states become increasingly
influenced by global rather than local macroeconomic
factors after the EU accession and that the level of integration
with global markets increases.

Product details

• Authors: Tony Southall
• Publisher: Physica-Verlag
• Languages: English
• Product format: Hardback
• Released: 14.12.2012
• EAN: 9783790820737
• ISBN: 978-3-7908-2073-7
• No. of pages: 190
• Dimensions: 161 mm x 240 mm x 17 mm
• Weight: 479 g
• Illustrations: XVIII, 190 p. 39 illus.
• Series: Contributions to Economics; Contributions to Economics
• Subjects: Social sciences, law, business > Business > International economy; B, macroeconomics, Economics and Finance, International Economics, Regional Studies, Political Economy, Macroeconomics and Monetary Economics, Macroeconomics/Monetary Economics//Financial Economics, Regional/Spatial Science, European Integration, Regional and Spatial Economics, regional economics, Monetary Economics, International institutions, Management science, Spatial economics, European Economic Community literature