The question of international capital market integration or segmentation has become an important issue for international investors and for companies seeking to source their capital internationally. Previous research has suggested that international listing represents one effective way to mitigate the effects of international market segmentation. Segmentation is caused by various types of barriers to international investment as restrictions on portfolio investment, liquidity, and a poor institutional environment. Previous studies have shown that liquidity, the size of the investor base, and market segmentation influence the cost of capital. Hence, an international listing may reduce a firm's cost of capital, if it increases the size of the investor base, leads to an increase in the liquidity of a firm's stock, and reduces international market segmentation. The objective of this study is to examine whether an international listing on the London Stock Exchange, NASDAQ, and the New York Stock Exchange (NYSE) has an impact on the cost of capital of firms. The main focus of this study is to investigate if the decision to raise equity capital with the listing affects liquidity and market integration. The purpose of the thesis is fourfold: (1) to investigate whether foreign firms that list on NYSE or NASDAQ experience more positive wealth effects in the pre-listing period and a stronger decline in expected returns in the post-listing period than London listings; (2) to compare changes in the liquidity of stocks when they become internationally listed on one of the three major global stock exchanges, the London Stock Exchange, the New York Stock Exchange (NYSE), and NASDAQ; (3) to examine the effect of alternative international equity offering methods on liquidity and its subsequent impact on the cost of capital; (4) to investigate the transfer of pricing information for non-US companies that conducted a simultaneous initial public offering on the NYSE and on their domestic stock exchange. We find that foreign firms that list on the New York Stock Exchange or NASDAQ experience positive abnormal returns prior to their US listing, and a decline in expected returns in the post-listing period. On the contrary, foreign firms that list on the London Stock Exchange do not experience any significant changes. This suggests that the benefits associated with a US listing are higher, since foreign firms make themselves more accessible for US investors by complying with the stringent disclosure requirements of the Securities and Exchange Commission (SEC). These benefits may even be higher for emerging market firms which use their ADR listing to raise equity capital. Although emerging market firms may try to time their issues to take advantage of some form of "emerging market sentiment", the evidence is only weak. The finding of substantial positive returns of the ADR price for firms that upgrade their previously OTC-traded ADR programme to a listing are rather an indication of the benefits experienced with a listing. The results show that the liquidity of stocks which list on the London Stock Exchange, the New York Stock Exchange, and NASDAQ increases subsequent to the listing. However, firms listing on NYSE appear to experience the strongest abnormal volume effects. In addition to the persistent long-term impact on liquidity, we also document significant short-term trading volume effects of international listings. Our comparison of international listings and control firms matched by nationality, firm size, and industry confirms our finding that internationally listed firms experience an increase in liquidity. This study also provides evidence that 80 percent of our sample firms, which obtained a "full" ADR listing on NYSE or NASDAQ, experience an increase in their total order flow. Moreover, the US order flow of NYSE-listed firms is higher than in their pre-listing domestic market for 83 percent of our sample firms. The results provide evidence that non-US firms which conduct a public offerings in the US have lower bid-ask spreads than private placements. Our sample consists of 231 international equity offerings from 33 countries world-wide; 86 companies conducted a public offering on NYSE or NASDAQ, and 145 companies raised capital in the private placement market. We find that the decision between a public offering or a private placement under Rule 144 A has an impact on the cost of capital of a firm. Our cost-benefit analysis shows that the benefits of a public offering outweigh the cost advantage of private placements. We provide empirical evidence that the interaction between the domestic and the foreign stock market leads to lower bid-ask spreads for internationally listed firms. The investigation of the determinants of domestic and foreign trading volume indicates that international listing increases the total trading volume. Trading volume on the foreign stock exchange appears to be strongly influenced by the percentage of equity issued in the foreign market. In contrast to previous studies that examine "normal" cross-listings, our results show that in many cases NYSE prices seem to lead domestic prices. This result is particularly pronounced for emerging market shares whose domestic markets often appear to be pure satellites of the NYSE market. Our results also show a higher speed of convergence between ADRs and underlying shares for developed market firms implying that arbitrage is undertaken more quickly. A comparative order flow analysis provides consistent evidence since a great number of firms experience a higher trading activity on the NYSE than on their domestic market. While previous evidence suggests that ADR IPOs are less underpriced than US IPOs, our results do not indicate any differences. Moreover, initial returns of emerging market and developed market IPOs do not seem to differ.

The main objective of this empirical research was to investigate whether there is a need for change in the accounting and audit requirements of small private companies in the UK, where there has been little empirical research or application of a theoretical framework for the analysis of the SC audit problems. In order to achieve the research objective, a comprehensive literature review of small company financial reporting (SCFR) was carried out to ascertain whether there was a generally acceptable auditing framework to offer possible solutions to the SC audit problems. It also sought to identify the role played by the main parties in SCFR, and to examine the main SCFR issues and arguments in the SCFR debate. Furthermore, a survey of SC accounts was undertaken to check whether the disclosures seemed to be consistent with the various financial reporting requirements. In addition, postal questionnaires were used to ascertain the views of selected directors and auditors of SCs about SCFR issues. The main findings of this empirical research broadly indicate, within a SCFR context, that: There is a generally acceptable framework for company audit but due to the characteristics of SCs, there are a number of weaknesses in its application to SCs. The literature review identifies possible solutions to overcome some of these problems. The survey of accounts indicates that there is an apparent improvement in filing of accounts within the statutory time limit and that there is a fall in the number of qualified audit reports. The survey shows that the majority of SCs do not take advantage of filing abbreviated accounts, and the extent of non-compliance with various financial reporting requirements appears not to be wide-spread. With respect to the surveys of the directors and auditors, the study identifies a number of similar views concerning the ownership and control of SCs by their directors and their families, the limitation of liability as the main advantage of incorporation and the need for an audit as the main disadvantage. Other similarities were the need for replacing full and abbreviated accounts of SCs with one set of accounts including a shortened profit and loss account with possible disclosures of turnover and profit before tax figures. Differences of view emerged over directors' and auditors' perceptions of the value of an audit, with a higher proportion of directors claiming them to be valuable. Cross analysis of results provided some assurances about the consistency of the above results. Comparing the results of these surveys with those of Page (1981), they appear to suggest that there are changes in directors' and auditors' attitudes over the last decade regarding the need for an audit and the main uses of SC accounts. In conclusion, this empirical research calls for simplification of the form and content of SC accounts and the relaxation of audit requirement for certain categories of SCs.

There has been an increased interest on the electronification of payments systems in the last two decades in general and on electronic money (e-money) on particular in the last decade with increased computing power and decreased cost of communication. E-money did not only attract attention from the academicians but also from central bankers, financial supervisory authorities, treasuries, finance ministries and innovators and operators all around the world. The purpose of this thesis is fourfold. Firstly, it seeks to define and critically assess e-money including the expected functions, necessary features, its potentials and major implications for different sides of financial system. Secondly, it tries to present empirical evidence on the current stage of e-money technology with two case studies, namely Mondei and Digicash. Thirdly, it investigates the perception of e-money innovators and operators with an assumption that they have the power and influence on the future shape of e-money. This section includes the analysis of two European surveys and one additional comparative survey conducted in Miami, the US. Lastly, it studies the free banking implications of e-money covering the impact on monetary policy framework and monetary policy instruments including whether e-money should be regulated or not. The research finds that the current definitions given to the e-money phenomenon is incomplete and defines the necessary functions and features for the future success of e-money applications. It describes e-money trends in Europe and compares it to the US perception finding no serious differences although the FED and the ECB have different approaches to money. Another conclusion the thesis reached is that e-money may result in a new approach to central banking with a contestable framework through the synergies with free banking. Finally, e-money is not seen as a danger for the successful conduct of monetary policy and the thesis underlines that when it is `representative', regulation is possible whereas `independent'money issuance may manage to stay out of the coverage of conventional regulatory frameworks.

This thesis examines the "timing" of equity issues. We seek to find the factors that "drive" the time series variation in the equity issuance activity. Our main motivation is to see whether the Initial Public Offerings, Seasoned equity offerings and Takeover activity financed with equity move together. Our second motivation is to see whether certain individual factors affect the timing of the three corporate activities. We focus our research effort on whether business conditions, adverse selection costs and "sentiment timing" can explain the variation in equity issue activity across time. Economic conditions have a significant effect on equity issuance activity. More firms make an IPO and more capital is raised from IPOs during the upturn of the business cycle relative to the downturn of the cycle. The impact of economic conditions on the SEO volume is also positive but marginally significant. In addition, more bidders use equity to finance a takeover bid during the upturn of the business cycle. The improvement of business conditions has a significant effect on the magnitude of adverse selection costs associated with the announcement of a SEO and a takeover bid that is financed with equity. During the upturn of the business cycle the market reacts less adversely to the announcement of these actions while in the downturn of the cycle the announcement of the SEO and the equity financed bid is accompanied by more negative returns. Underpricing for IPOs however is not lower during the upturn of the business cycle. Firms that make an IPO, a SEO and a takeover bid that is financed with equity are associated with significant adverse share price movements which impose significant indirect costs to the issuers and bidders. This thesis investigates how these costs affect the timing of the three corporate actions. The magnitude of adverse selection costs has a significant effect only on the volume of Seasoned equity offerings with more firms making a rights issue during periods when the announcement of the recent rights issues is accompanied by less negative returns. IPO volume is not higher when the average first day returns of the recent IPOs are low and the percentage of bidders that use equity to finance the bid over all bidders is not higher when the drop of the share price of the bidder on the announcement of the recent equity financed bids is smaller. It has been widely documented that firms which make an IPO, a SEO and a takeover bid that is financed with equity offer inferior returns to their shareholders in the post-issue period. Cognitive bias and deliberate timing of these actions at periods when share prices are irrationally high are the best explanations that the literature has provided for the underperformance. We find a significant underperformance of SEOs and bidders that use equity to finance the bid and IPOs if the high first day returns are not included. These findings suggest that the above firms are overvalued at the time these action take place but does not address whether variations in volume across time are driven by variation in the degree of overvaluation. We find that only variations in IPO volume are driven by variations in the degree of overvaluation. Periods when more capital is raised from IPOs are periods when the average IPO is more overvalued than IPOs that go public in periods when IPO activity slows down. Variations in the SEO volume and the equity financed takeover activity are not driven by overvaluation exploitation. Time series regressions on the amount raised from IPOs and SEOs reveals the significant role of investors' sentiment on the timing of equity issues. We use financial analysts earnings forecasts as a proxy for market sentiment and we find that more capital is raised from IPOs during periods when analysts' earnings forecasts for the recent IPOs are more optimistic. We also find that more capital is raised from SEOs during periods when analysts' earnings forecasts for the recent SEOs are more overoptimistic. Previous empirical studies suggest that firms time the issues at the peak of their profitability. Our evidence from financial analysts earnings forecast revisions reveal that SEO firms time the issue after a period of high earnings growth and prior to a small deterioration in earnings while IPO firms time the issue at the beginning or during a period of sustainable earnings growth and not at the peak of their profitability.

This thesis aims to investigate four main areas of interest in the functioning of different markets in the dry bulk shipping sector using recent econometric and time series techniques. These areas include; seasonality patterns in freight markets, the efficient market hypothesis and the existence of time-varying risk premia in freight rate and ship price formation, the dynamic interrelationships between freight rate levels and spillover effects in freight rate volatilities, between sub-markets of the dry bulk sector. The seasonal behaviour of' dry bulk freight rates is measured and compared across vessel sizes, contract duration and under different market conditions. Seasonality is deterministic rather than stochastic and it varies across vessel sizes, contract durations and market conditions. In particular, freight rates for larger vessels show higher seasonal variations than smaller ones. Seasonality in spot rates is higher than timecharter rates across the size. Also, seasonal fluctuations are found to be stronger during market expansions compared to market down turns. The validity of the expectations hypothesis of the term structure (EHTS) in the formation of both one and three-year time-charter rates is strongly rejected for all size carriers. Failure of the EHTS is attributed to shipowners' perceptions of risk regarding their decision to operate in spot or time-charter markets. Time-varying risk premia in the formation of period rates is found to be negative; shipowners are prepared to accept lower rates for the relative security of longer contracts. The higher risk involved in contracts with shorter term to maturity are thought to emanate from higher freight rate volatilities, relocation costs, risk of unemployment in spot markets as well as fluctuations in voyage costs. Investigating the dynamic interrelationships between freight rates for different size vessels and spillover effects between volatilities in spot and period markets reveal that the interaction between freight rates in the spot market is higher than in the period markets. It is also found that there is a unidirectional transmission of volatility from larger to smaller size vessels in both spot and period markets. Finally, results strongly reject the EMH in the market for newbuilding and secondhand dry bulk vessels. Failure of the present value model and price efficiency is attributed to the risk associated with holding these assets. Results of Generalised Autoregressive Conditional Heteroscedasticity in Mean (GARCH-M) models suggest that there is a positive relationship between time-varying risk and return on shipping investments, a result which is consistent with asset pricing theories in the financial economics literature.

This thesis is primarily concerned with the reaction of UK investment analysts when confronted with window dressed financial statements and its implications for stock market information processing and efficiency. Three associated empirical examinations are undertaken. 1) A detailed investigation of the prevalence of window dressing in UK company accounts and the nature of such exercises is conducted using a random sample of 100 sets of accounts for large UK corporates. A substantial degree of window dressing is identified. The analysis is developedfurther to explore the relationship between extent of window dressing and financial position of the firm although the results are ambiguous. 2) To explore the importance of accounting information generally to the investment analysis community, relative to alternative sources, and the manner in which it is used to drive investment recommendations a detailed content analysis of a large sample of stockbroker circulars is conducted. The results suggest the importance of accounting information for market participants may be conventionally overstated. Nonetheless the statistical findings, although significant, are not very strong which may partially reflect the heterogeneity found in the methods used by different stockbroking firms in appraising shares. Further work is required. 3) The main part of the thesis reports on a laboratory experiment with 63 experienced stockbroking analysts drawn from five of the top City houses. The analysts were required to process company accounts and adjust for window dressed items. We were forced to conclude that, at least at the time, the research took place in early 1990, investment analysts were neither very concerned by nor able or inclined to correct for creative accounting. These findings are discussed in detail and implications for different market theories drawn. The theories conclude that there may well be valid concerns about the conventional role attributed to investment analysts as information intermediaries in maintaining market efficiency, particularly in the processing of and disseminating complex accounting information.

The need for a conceptual framework for auditing to guide the development of auditing standards and practice on a consistent and theoretically sound basis has been recognised by many practitioners and academicians. This need seems to be even stronger in the case of internal auditing. Thus, one major objective of the research is to take a step towards developing a widely accepted conceptual model that encompass the different concepts, identify the main objectives, define the functions, and explain the different interrelationships that exist within internal auditing. This follows a rigorous review of literature and theoretical background to set the research terms. It is imperative that the attempt to develop the model should be accompanied by empirical study concerned with its applicability. Thus, the model is then used to examine how internal auditors working in developing countries perceive internal auditing. As well as, examining the standard of practice of internal auditing in developing countries. Two questionnaires are developed and used as the research instruments. The first questionnaire is used to collect data on the perception of internal auditing, and the second is used to collect data on the practice of internal auditing. Factor analysis is then applied to data collected to explore the relationship between the different statements included in the questionnaires. The empirical chapters consider: significant perceptual differences between different levels of internal auditors; significant perceptual differences between internal auditors working in the public and private sectors; significant differences in the practice of internal auditing between public and private sectors. Main findings indicate that: the perception of internal auditing is significantly influenced by the level and experience of internal auditors; the perception of internal auditing is significantly influenced by the sector in which internal auditors work; the practice of internal auditing varies significantly between the public and private sectors; generally positive perception among all respondents of what is promoted by the conceptual framework; the practice of internal auaiting in developing countries still lags behind what is promoted by the conceptual framework.

The intra firm diffusion, that is the process leading a firm to extensively use new (or superior) technologies, is a key step to promote the growth and the competitiveness of a nation. However, even when advanced technologies are readily available within the market, the process leading a firm to replace the old with those new technologies can take several years, quite often decades. In existing economic literature this aspect of technological change has been almost completely neglected. In fact, despite its relevance, there exist only two relevant pieces of work in the area (Stoneman, 1981 and Mansfield, 1968). This thesis has pointed out the weaknesses of this literature on both theoretical and empirical grounds and has explored alternative theoretical approaches to modelling the intra-firm diffusion process. This has lead to the derivation of a new theoretical model, solidly grounded within economic theory. This model determines how changes in costs, price expectations (economic constraint), production organisation at plant level, existing and previous technologies (technological constraints), consumer demand and market structure (market constraint) and uncertainty can influence the degree of technology adoption by a firm. The impact of uncertainty, price expectations and market structure play upon the firm's investment decision in a new technology, have never been studied before. Moreover, using sophisticated statistical and econometric tools, this study also tests the validity of this theoretical approach, across a cross section of firms in the UK engineering and metalworking sector. The theoretical model presented in this thesis is based upon neo-classical investment literature and provides a rationale explaining the potential unprofitability of a rapid transfer of all firm's production to a new technology. This can be seen as a unique contribution to the understanding of the determinants of the adoption of a new technology, while the empirical analysis provides considerable insight into a area where to date, little research has previously been completed.

The aim of the thesis is to investigate strategic trading under asymmetric information in particular …financial markets. To this end, this thesis is organized into three essays. The …first essay discusses market manipulation. In particular, it first focuses on its central role when interpreting phenomena of strong persistent mispricing in specific …financial markets and finds minimal conditions for this market abuse to be sustainable over time. Then a taxonomy of market manipulation is presented, and simple examples provided. While different market structures and regulations are taken into account, informational asymmetry is proposed as the common ingredient in any manipulative behavior. Finally, the theory is synthesized, focusing on strategic agent-based modeling. The second essay proposes a unifi…ed theory of market non-anonymity in a model of strategic trading. Large …financial markets with either mandatory or voluntary public disclosure of trades are considered. The analysis considers whether extra displayed information is used by a possibly informed trader to manipulate others' beliefs. It is demonstrated that disclosures in some instances might be informative and in particular, when voluntary, they are always undertaken. Important price behaviour and (sometimes manipulative) trading strategies are identified. Policy implications are drawn, and regulatory interventions to enhance price efficiency and simultaneously prevent market abuses are scrutinized. The third essay provides a model of strategic trading in the single-dealer market, with an informed dealer standing ready to buy and sell a risky asset at her public bid and ask quotes. First, uninformed liquidity traders are considered. Then, a group of informed speculators is introduced. In contrast to other models, it can well be that the asset value lies outside the equilibrium price spread.

This doctoral thesis investigates the transition from a bank-based to a capital marketbased financial system that has taken place in Malaysia over the last two decades. In so doing, it more closely traces Malaysian financial policymaking processes, specifically efforts to develop domestic bond markets since the mid-1980s. Based on recent insights from the constructivist political economy literature and drawing on a wide range of Malaysian policy documents as well as elite interviews, it argues that the shift which has taken place can only be understood against the backdrop of the changing ideational underpinnings of financial policymaking. Neoliberal economic reforms that were implemented in the 1980s served as a powerful rationale for pro-capital market reforms. However, this thesis detects a qualitative change within the market paradigm after the Asian financial crisis of 1997-8, away from simply rolling out markets towards institutionbuilding. This led to increased efforts to develop local bond markets. Furthermore, this thesis suggests that the expansion of bond finance in Malaysia has entailed larger socio-economic changes which can be subsumed under the notion of financialisation. A number of examples are presented in the thesis. More specifically, the increasing salience of bond finance has given rise to a new politics of debt, as debt has become successively privatised and individualised. However, progressive financial disintermediation in Malaysia has also changed the underlying dynamics of Malaysian capitalism more generally in favour of a greater market orientation. Contrary to existing accounts on the role of bond finance, it is argued that policy autonomy is not so much directly constrained by market forces, as by the pervasive hold that specific forms of (financial) market knowledge have taken in the state apparatus. However, the rise of Islamic finance in Malaysia will be discussed to illustrate that a small developing country can retain some epistemic autonomy.