Colombian ADRs: Why so few?

Maximiliano González, Alexander Guzmán, María Andrea Trujillo
2011 Innovar: Revista de Ciencias Administrativas y Sociales  
We address the question of why Colombian companies have had such a limited presence in the American Depositary Receipts (ADRs) market. Traditional explanations state that weak investor protection and the degree of economic and financial development in Colombia increase the cost of entry in the ADR market. However, in the case of Colombia these explanations do not suffice because in these respects Colombia is no different from other Latin American countries. Using a theoretical model, we show
more » ... t additional factors such as drug trafficking and armed conflict better explain why Colombian firms have moved away from the ADRs market
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