Do financial systems converge? New evidence from financial assets in OECD countries

Fresh Patterns of Liberalization, Bank Return and Return Uncertainty in Africa

“…Hence, a direct consequence of full convergence is that there are similar yields for financial assets of similar liquidity and risk, regardless of locality and nationality. This intuition is in accordance with an interesting bulk of recent literature on the modeling and timing of intellectual property rights (IPRs) harmonization against software piracy (Andrés & Asongu, 2013;Asongu, 2013d); common initiatives against African capital flight (Asongu, 2014g); the future of knowledge economy (Asongu, 2013g,h); health of financial markets (Bruno et al, 2012;Narayan et al, 2011;Asongu, 2013e, 2014e) and currency areas (Asongu, 2013f, 2014f), inter alia.…”

“…However, we could not constraint the conditional assessment beyond these control variables due to issues in degrees of freedom. Accordingly, some models in the literature are not conditioned beyond two macroeconomic variables (Bruno et al, 2012).…”

African Stock Market Performance Dynamics: A Multidimensional Convergence Assessment

“…Islam (2003) has shown that, β-convergence is a necessary but not sufficient condition for σ-convergence, but has a more natural interpretation in the context of growth models. The existing literature uses several alternative approaches to identify whether and when convergence occurs (Bruno et al, 2011). Initial empirical tests of the convergence hypothesis considered β-convergence.…”

“…According to the convergence literature (Bruno et al, 2011;Narayan et al, 2011), while there is a theory and vast empirical work on per capita income convergence, there is as yet not a theory on financial system convergence. Given this reality, like in Narayan et al (2011) we are aware of the risks of "doing measurement without theory" and assert that reporting facts, even in the absence of a formal theoretical model may be a useful scientific activity.…”

“…These events and a rethinking of the role of finance after the recent financial crisis (Baltagi & Demetriades, 2011) have prompted a growing number of studies focused on the differences and similarities between national financial systems (Bruno et al, 2011). These have culminated in two growing strands in the literature on the impact of globalization on financial market convergence.…”