| Summary: | 碩士 === 雲林科技大學 === 財務金融系碩士班 === 97 === This study discusses the influence of central and local election on stock market by using market average model of event study. There are 16 election events containing various central and local election from 1993 to 2009. These events include the presidential, legislators, Taipei and Kaohsiung city mayors and county mayors elections. In addition to the stock market returns, we compare the central versus local election, before the changing of ruling party versus the substitution of ruling party, the returns before KMT party versus DPP party. The empirical results show that : first we find before election date, most of the returns are negatively abnormal then the stock index moves from downward to upward. After election, there shows the positive abnormal return, as times approaches the election date, the interaction gets more significant. Second, before the changing of ruling party versus the substitution of ruling party, we find that if the ruling party wins the election then it has higher election bull run. Third, we find that after the local election, it shows higher election bull run and abnormal return than central election. Finally, we find that after the election, the DPP party has higher election bull run and abnormal return than KMT party.
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