01802cas a2200253 a 4500 AALejournalIMF003813 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451862010 1018-5941 BD-DhAAL BD-DhAAL Podpiera, Richard. European Union Enlargement and Equity Markets in Accession Countries / Richard Podpiera, Tomas Dvorak. Washington, D.C. : International Monetary Fund, 2005. 1 online resource (28 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The announcement of the European Union enlargement coincided with a dramatic rise in stock prices in accession countries. This paper investigates the hypothesis that the rise in stock prices was a result of the repricing of systematic risk due to the integration of accession countries into the world market. We found that firm-level stock price changes are positively related to the difference between a firm's local and world market betas. This result is robust to controlling for changes in expected earnings, country effects, and other controls, although the magnitude of the effect is not very large. The differences between local and world betas explain nearly 22 percent of the stock price increase. Mode of access: Internet Dvorak, Tomas. IMF Working Papers; Working Paper ; No. 2005/182 Full text available on IMF http://elibrary.imf.org/view/journals/001/2005/182/001.2005.issue-182-en.xml IMF e-Library