Allowing relatively open issuance and competition in stock and bond markets is called:
A) regulatory arbitrage.
B) capital market liberalization.
C) contagion.
D) conditionality.

Question

Quizplus · Accepted Answer

Capital market liberalization refers to the process of opening up the stock and bond markets to competition and relatively open issuance, in order to promote economic growth and attract foreign investment. Regulatory arbitrage involves taking advantage of differences in regulatory systems to achieve a competitive advantage, while contagion refers to the spread of economic or financial crises from one country to another. Conditionality refers to the requirements or conditions attached to loans or aid provided by international organizations or governments.

Allowing Relatively Open Issuance and Competition in Stock and Bond