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Evidence on financial globalization and crisis: capital raisings


  • Galina Hale


Financial globalization opened international capital markets to investors and firms all over the world. Foreign capital raisings by firms have increased substantially since the early 1990s in terms of equity as well as debt. I review the literature on the determinants and patterns of cross-border capital raisings and their effects on developments of domestic markets, highlighting the differences between mature and emerging economies. I focus on the effects the introduction of the euro had on European and global capital markets by bringing into existence a currency area comparable in size to that of the United States. Finally, I discuss the effects of financial crises on foreign capital raisings and review capital raisings during the 2007-09 global financial crisis.

Suggested Citation

  • Galina Hale, 2011. "Evidence on financial globalization and crisis: capital raisings," Working Paper Series 2011-04, Federal Reserve Bank of San Francisco.
  • Handle: RePEc:fip:fedfwp:2011-04

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    References listed on IDEAS

    1. Arteta, Carlos & Hale, Galina, 2008. "Sovereign debt crises and credit to the private sector," Journal of International Economics, Elsevier, vol. 74(1), pages 53-69, January.
    2. Hale, Galina & Arteta, Carlos, 2009. "Currency crises and foreign credit in emerging markets: Credit crunch or demand effect?," European Economic Review, Elsevier, vol. 53(7), pages 758-774, October.
    3. Gozzi, Juan Carlos & Levine, Ross & Schmukler, Sergio L., 2010. "Patterns of international capital raisings," Journal of International Economics, Elsevier, vol. 80(1), pages 45-57, January.
    4. Kalemli-Ozcan, Sebnem & Papaioannou, Elias & Peydró, José-Luis, 2010. "What lies beneath the euro's effect on financial integration? Currency risk, legal harmonization, or trade?," Journal of International Economics, Elsevier, vol. 81(1), pages 75-88, May.
    5. Mark M. Spiegel, 2009. "Monetary and Financial Integration in the EMU: Push or Pull?," Review of International Economics, Wiley Blackwell, vol. 17(4), pages 751-776, September.
    6. Rose, Andrew K. & Spiegel, Mark M., 2011. "Cross-country causes and consequences of the crisis: An update," European Economic Review, Elsevier, vol. 55(3), pages 309-324, April.
    7. Carmen M. Reinhart & Graciela L. Kaminsky, 1999. "The Twin Crises: The Causes of Banking and Balance-of-Payments Problems," American Economic Review, American Economic Association, vol. 89(3), pages 473-500, June.
    8. Nicolas Coeurdacier & Philippe Martin, 2009. "The Geography of Asset Trade and the Euro: Insiders and Outsiders," NBER Chapters,in: Financial Globalization, 20th Anniversary Conference, NBER-TCER-CEPR National Bureau of Economic Research, Inc.
    9. Spiegel, Mark M., 2009. "Monetary and financial integration: Evidence from the EMU," Journal of the Japanese and International Economies, Elsevier, vol. 23(2), pages 114-130, June.
    10. Burger, John D. & Warnock, Francis E., 2007. "Foreign participation in local currency bond markets," Review of Financial Economics, Elsevier, vol. 16(3), pages 291-304.
    11. Galina Hale & Mark M. Spiegel, 2008. "Who drove the boom in euro-denominated bond issues?," Working Paper Series 2008-20, Federal Reserve Bank of San Francisco.
    12. Julian Caballero & Christopher Candelaria & Galina Hale, 2009. "Bank relationships and the depth of the current economic crisis," FRBSF Economic Letter, Federal Reserve Bank of San Francisco, issue dec14.
    13. Ross Levine & Sergio L. Schmukler, 2006. "Internationalization and Stock Market Liquidity," Review of Finance, European Finance Association, vol. 10(1), pages 153-187.
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    Cited by:

    1. Ionuț Bușega, 2015. "The impact of the financial crisis under the effects of increasing global economic interdependence. The case of Eastern and Central Europe Economies," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 18(55), pages 97-116, March.

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    Globalization ; Capital market;

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