BEKAERT, GEERT; HARVEY, CAMPBELL R.; LUNDBLAD, CHRISTIAN; … - In: Journal of Finance 62 (2007) 3, pp. 1081-1137
We propose an exogenous measure of a country's growth opportunities by interacting the country's local industry mix with global price to earnings ("PE") ratios. We find that these exogenous growth opportunities predict future changes in real GDP and investment in a large panel of countries. This...