Do International Cross-Listings Still Matter?
EVIDENCE ON FINANCIAL GLOBALIZATION AND CRISES, Thorsten Beck, Sergio Schmukler, Stijn Claessens, eds., Elsevier North-Holland Publishers, 2010
42 Pages Posted: 11 Jul 2010 Last revised: 28 Jul 2010
Date Written: May 28, 2010
With the rapid globalization of financial markets during the 1980s and 1990s, increasingly more firms from around the world began cross-listing their shares on major overseas stock exchanges. During the past decade, however, the number of new international cross-listings on major exchanges around the world has slowed, yet the globalization process has continued to advance. This article asks whether international cross-listings still matter for global capital markets and answers this question by critically reviewing the most recent research on international cross-listings that focuses on multi-market trading, liquidity, and arbitrage. We conclude that cross-listings continue to be vibrant influencing price discovery, trading, and capital-raising for many companies around the world and thus still represent an important force for the integration of global financial markets.
Keywords: Multi-market trading, Idiosyncratic risk, limits to arbitrage, Information, Volume, Comovements, Spillovers, International finance
JEL Classification: F30, G15, G32
Suggested Citation: Suggested Citation