Deep Financial Integration and Volatility

  title={Deep Financial Integration and Volatility},
  author={Sebnem Kalemli‐Ozcan and Bent E. S{\o}rensen and Vadym Volosovych},
  journal={Macroeconomics: Prices},
We investigate the relationship between foreign direct ownership of firms and firm- and region-level output volatility using a novel panel data set for European countries. We document a positive, highly robust, relationship between firm-level foreign ownership and volatility of value added. This relationship holds cross-sectionally and in panels with firm fixed effects where the relationship captures within-firm variation over time. Considering domestic firms with assets in foreign countries… 

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