Browsing by Subject "Investing"
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Item Deciding where to invest in the developing world : determinants of FDI flows(2017-05) Sierra Castillo, Jose D; Jensen, Nathan M. (Nathan Michael), 1975-The relationship between the type of political regime and foreign direct investments has been widely studied. The large number of studies have explored different elements of the FDI and regime type link, but little consensus has emerged on the overall relationship. In this paper I conduct the first elite level experiment of how political regimes shape investment decisions. By using an original sample of investment analysts from one of the top investment firms in the world I find that the political regime has a significant and substantive effect on investor decisions on whether or not to invest on a foreign country. This finding is robust under varying levels of property rights, capital controls, judicial independence, and economic conditions. I also find that the effect of political regimes is strengthened when the protection of property rights fall. This indicates that regime type plays an instrumental role in investors’ decision making process. The results point towards a need to better understand why political regimes matter to attract investment flows.Item The Federal Reserve's monetary policy effect on financial markets and investors(2017-05-08) Owens, John Richard III; Galbraith, James K.; Brown, KeithThis paper explores the short and long-term effects of the Federal Reserve’s post-recession monetary policy. Since 2009, in the wake of the Great Recession, the Federal Reserve took unprecedented action by lowering the federal funds rate to zero. This zero-interest rate policy persisted until late 2015, when the Federal Reserve increased rates for the first time in 7 years. While rates have increased slightly, the economy continues to operate in a low interest rate environment. By keeping the federal funds rate near zero for such an extended period of time, the Federal Reserve precipitated significant effects on the economy and investors. This paper analyzes the short-term, intermediate, and long-term effects of the Federal Reserve’s post-recession monetary policy on the financial markets and institutional investors; specifically, we examine the fed funds rate effect on the economy, equity markets, interest rates, private equity industry, and investor portfolios.