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Are Expansions Cost Effective for Stock Exchanges? A Global Perspective

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  • Hasan, Iftekhar

    ()
    (Rensselaer Polytechnic Institute and Bank of Finland Research)

  • Malkamäki, Markku

Abstract

This paper investigates the existence and extent of economies of scale and scope among stock exchanges. Evidence from 38 exchanges in 32 countries and 4 continents around the world for the years 1989-1998 indicates the existence of significant economies of scale and scope. The degree of such economies however differs by size of exchange and region. The largest stock exchanges show an increasing trend of cost effectiveness. Exchanges in North America and Europe report substantially larger economies of scale than those in the Asia-Pacific regions.

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File URL: http://www.suomenpankki.fi/en/julkaisut/tutkimukset/keskustelualoitteet/Documents/0020.pdf
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Bibliographic Info

Paper provided by Bank of Finland in its series Research Discussion Papers with number 20/2000.

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Length: 36 pages
Date of creation: 18 Dec 2000
Date of revision:
Handle: RePEc:hhs:bofrdp:2000_020

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Postal: Bank of Finland, P.O. Box 160, FI-00101 Helsinki, Finland
Web page: http://www.suomenpankki.fi/en/
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Keywords: stock exchanges; mergers; regional alliances; economies of scale;

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References

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Citations

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Cited by:
  1. Kauko, Karlo, 2003. "Interlinking securities settlement systems: A strategic commitment?," Research Discussion Papers 26/2003, Bank of Finland.
  2. Hasan, Iftekhar & Schmiedel, Heiko, 2004. "Networks and equity market integration: European evidence," International Review of Financial Analysis, Elsevier, vol. 13(5), pages 601-619.
  3. Ben Slimane, FATEN, 2007. "L'Evolution des Marchés Boursiers Européens: Enjeux et limites
    [European Stock Market Evolution]
    ," MPRA Paper 2607, University Library of Munich, Germany.
  4. Hasan, Iftekhar & Schmiedel , Heiko, 2003. "Do networks in the stock exchange industry pay off? European evidence," Research Discussion Papers 2/2003, Bank of Finland.
  5. Baris Serifsoy & Marco Weiß, 2007. "Settling for Efficiency - A Framework for the European Securities Transactions Industry," Working Paper Series: Finance and Accounting 151, Department of Finance, Goethe University Frankfurt am Main.
  6. Heiko Schmiedel & Markku Malkamäki & Juha Tarkka, 2004. "Economies of scale and technological development in securities depository and settlement systems," Microeconomics 0405001, EconWPA.
  7. Schmiedel, Heiko & Malkamaki, Markku & Tarkka, Juha, 2006. "Economies of scale and technological development in securities depository and settlement systems," Journal of Banking & Finance, Elsevier, vol. 30(6), pages 1783-1806, June.
  8. Schmiedel, Heiko & Malkamäki, Markku & Tarkka , Juha, 2002. "Economies of scale and technological development in securities depository and settlement systems," Research Discussion Papers 26/2002, Bank of Finland.
  9. William O. Brown, Jr. & J. Harold Mulherin & Marc D. Weidenmier, 2006. "Competing With the NYSE," NBER Working Papers 12343, National Bureau of Economic Research, Inc.
  10. von Furstenberg, George M. & Tabora, Carlos B., 2004. "Bolsa or NYSE: price discovery for Mexican shares," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 14(4), pages 295-311, October.
  11. Hasan, Iftekhar & Malkamäki, Markku & Schmiedel, Heiko, 2002. "Technology, automation, and productivity of stock exchanges: International evidence," Research Discussion Papers 4/2002, Bank of Finland.
  12. Theissen, Erik, 2003. "Organized equity markets in Germany," CFS Working Paper Series 2003/17, Center for Financial Studies (CFS).
  13. Heiko Schmiedel & Markku Malkamäki & Juha Tarkka, 2004. "Economies of scale and technological development in securities depository and settlement systems," Microeconomics 0405002, EconWPA.
  14. Faten Ben Slimane, 2012. "Stock exchange consolidation and return volatility," Managerial Finance, Emerald Group Publishing, vol. 38(6), pages 606-627, May.
  15. Schmiedel, Heiko, 2002. "Total factor productivity growth in European stock exchanges: A non-parametric frontier approach," Research Discussion Papers 11/2002, Bank of Finland.
  16. Jong-Kun Lee & Biaggio Bossone, 2002. "In Finance, Size Matters," IMF Working Papers 02/113, International Monetary Fund.
  17. Meeus, Leonardo, 2011. "Why (and how) to regulate power exchanges in the EU market integration context?," Energy Policy, Elsevier, vol. 39(3), pages 1470-1475, March.

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