Purpose - This paper focuses on execution costs as liquidity measure. Execution costs are related to volatility and are an important component of a firm’s cost of capital. The purpose of this paper is to examine whether emerging market firms have lower execution costs when they face less restrictions on foreign investment and when they have more foreign shareholders. Design/methodology/approach - The authors begin by documenting the cross-sectional behavior of execution costs. The authors then obtain preliminary evidence on the interaction between execution costs, the investability index and actual foreign investment. These results foreshadow those the authors obtain with the regression analysis. The ordinary least square results show that more investable firms have lower execution costs after the authors control for firm size, stock price, return volatility, industry effects and country effects. This evidence is very robust and highly significant. Direct foreign ownership (FO) in emerging market firms also appear to be associated with lower execution costs. The economic benefit from lowering the investability index on trade execution costs is highly significant. Findings - Using a large cross-sectional sample from 23 emerging markets, the authors show that firms with more Originality/value - There are important differences between the approach and most of the financial liberalization studies. First, whereas most of the earlier studies are conducted at the level of country or market analysis, the investigation is at the level of individual stocks. Second, the authors focus on a cross-sectional association that avoids a criticism leveled at time series analyses. Over-time studies often use specific time points to represent financial liberalization watersheds. This approach can be misleading when financial liberalizations are viewed as processes that unfold over time. Third, the proxies for financial openness are available not only for individual firms across markets, but the authors also make a distinction between potential and actual foreign investment. The authors further categorize actual foreign investment into direct and indirect FO.

中文翻译：

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在新兴市场的执行成本，可投资性和实际外国投资

目的-本文将执行成本作为流动性度量。执行成本与波动性有关，是企业资本成本的重要组成部分。本文的目的是研究新兴市场公司在面对较少的外国投资限制时以及在拥有更多外国股东时是否具有较低的执行成本。设计/方法/方法-作者首先记录执行成本的横断面行为。然后，作者获得了关于执行成本，可投资性指数和实际外国投资之间相互作用的初步证据。这些结果预示了作者通过回归分析获得的结果。普通最小二乘结果表明，在作者控制了公司规模，股票价格，回报波动，行业影响和国家影响。该证据非常有力且非常重要。新兴市场公司的外国直接拥有权（FO）也似乎与较低的执行成本有关。降低贸易执行成本的可投资性指数所带来的经济利益是非常重要的。研究结果-作者使用来自23个新兴市场的大量横断面样本，显示具有更高原创性/价值的公司-方法与大多数金融自由化研究之间存在重要差异。首先，尽管大多数较早的研究都是在国家或市场分析的水平上进行的，但调查是在单个库存的水平上进行的。其次，作者着重于避免在时间序列分析中提出批评的横截面关联。超时研究通常使用特定的时间点来表示金融自由化的分水岭。当金融自由化被视为随着时间而展开的过程时，这种方法可能会产生误导。第三，金融开放性的代理不仅适用于跨市场的单个公司，而且作者还对潜在和实际外国投资进行了区分。作者进一步将实际外国投资分为直接和间接FO。但是作者还区分了潜在的和实际的外国投资。作者进一步将实际外国投资分为直接和间接FO。但是作者还区分了潜在的和实际的外国投资。作者进一步将实际外国投资分为直接和间接FO。