Sri Lanka suffered from a civil war for three decades and this conflict ended in 2009. This study examines the impact of 20 war related incidents on Sri Lankan Initial Public Offering (IPO) stocks from 2000 to 2009. The broad methodologies used were event study analysis, Ordinary least square regression analysis (OLS) and the generalized autoregressive conditional heteroscedasticity (GARCH (1,1)) model. Under regression, the main techniques used were the Chow breakpoint test (CBT) and dummy variable analysis. OLS dummy variable analysis and the ordinary GARCH model appeared to be the best estimators in measuring the impact of war, while 50% of events selected had a negative impact on IPO stock returns. The ordinary GARCH model is recommended for use in assessing the impact of war on specific security classes or industries.
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