Conflict, political uncertainty and its impact on stock market has been a subject of interest in the literature. However, no study has yet explored the impact of political strikes on stock market outcomes. Political strike -- locally known as Hartal in Bangladesh -- is a different form of conflict than war or street protest, which is recurrent in nature. Using Dhaka Stock Exchange daily trading data of firms for the period 2005-2015 and controlling for a host of variables such as day, month, year, day-of-year trend and firm fixed effects, we find that political strike has a negative and statistically significant impact on stock market return. Our results show that, on the day of a political strike, stock market return drops about 0.14% which is economically sizable. This effect gets pronounced as the frequency of strike increases, based on week, month or year count of occurrences. Impact heterogeneity reveals that large firms are affected more from hartals compared to smaller firms.
権利
Copyrights 日本貿易振興機構（ジェトロ）アジア経済研究所 / Institute of Developing Economies, Japan External Trade Organization (IDE-JETRO) http://www.ide.go.jp
雑誌名
IDE Discussion Paper
雑誌名(英)
IDE Discussion Paper
巻
712
発行年
2018-05
出版者
Institute of Developing Economies (IDE-JETRO)
著者版フラグ
publisher
JEL分類
JEL:D24 - Production • Cost • Capital • Capital, Total Factor, and Multifactor Productivity • Capacity
JEL:D74 - Conflict • Conflict Resolution • Alliances • Revolutions
JEL:O14 - Industrialization • Manufacturing and Service Industries • Choice of Technology
地域/国名
Bangladesh
キーワード(LSH)
Political strikes
Stock price
Impact analysis
Securities
Political instability and stock market returns : evidence from firm-level panel data of securities in Bangladesh
Full-text PDF
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