| Publication |
2011.
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| Summary/Abstract |
Recent literature suggests the extent of foreign listings (cross-listings) on domestic stock exchanges may be informative as a measure of financial integration. In this study, we present both stylized facts and panel data analysis examining relationships between the proportion of foreign listings and other measures of integration in a sample of Asian markets to determine if this form of cross-listing complements or substitutes for other aspects of integration. We find that higher trade openness, higher output growth and lower inflation are associated with a greater proportion of foreign listings. In addition, we find that FDI openness has a negative relationship to the proportion of foreign listings, suggesting that these aspects of financial integration are substitutes. For policymakers, our results indicate that unless the appropriate financial liberalisation policies are in place, countries may find it difficult to simultaneously attract foreign listings to enhance development of their stock market and to grow their real economy through FDI.
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