The role of ADRs in the development and integration of emerging equity markets. Unpublished working paper

This study measures the dynamics of the growth and expansion of international cross-listings through American Depositary Receipts (ADRs) in emerging equity markets around the world and evaluates its impact on their development and integration with world markets. Overall, I find that the increasing number of new ADR programs, their market capitalization and trading volume in those countries are positively associated with the pace of international capital flows and greater market integration, but, at the same time, adversely impact the size and liquidity of the home markets. I discuss the implications of these findings for existing research on capital market liberalization and on ADR markets and for the public policy debate on ADR markets and their impact on the global competitiveness of national stock markets