Does the IFRS adoption promote emerging stock markets development and performance?

Recent accounting and financial researches suggest that the IFRS adoption leads to high-quality financial information characterized by their honesty. The purpose of this paper is to analyse the impact of IAS/IFRS adoption on key aspects of investment decision-making in emerging stock markets. The paper uses a state-space model combined with a standard GARCH specification and a multidimensional panel data model. The results of our empirical investigation show that the IFRS adoption contributed to improving development and performance of emerging markets. It leads to considerable development, reduced volatility, and prompt convergence towards information efficiency.