A peculiar pattern is evident across the stock markets of different countries. In emerging markets, such as Peru and China, all the stocks in the country tend to rise and fall together in the course of ordinary trading. But in developed
countries, such as Denmark and Canada, stocks move independently. What
seems to determine how independently a country’s stock prices move is not the
size of its market, the diversification of its economy, the stability of its
macroeconomic policy or factors relating to the behaviour of individual firms.
Rather, stock prices move more independently in countries that are less corrupt.