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Settling for Efficiency - A Framework for the European Securities Transactions Industry

Author

Listed:
  • Baris Serifsoy
  • Marco Weiß

Abstract

Despite a lot of re-structuring and many innovations in recent years, the securities transaction industry in the European Union is still a highly inefficient and inconsistently configured system for cross-border transactions. This paper analyzes the functions performed, the institutions involved and the parameters concerned that shape market and ownership structure in the industry. Of particular interest are microeconomic incentives of the main players that can be in contradiction to social welfare. We develop a framework and analyze three consistent systems for the securities transaction industry in the EU that offer superior efficiency than the current, inefficient arrangement. Some policy advice is given to select the 'best' system for the Single European Financial Market.

Suggested Citation

  • 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.
    • Handle: RePEc:fra:franaf:151
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    1. is not listed on IDEAS
    2. Troels Krarup, 2016. "Economic Discourse and the European Integration of Financial Infrastructures and Financial Markets," Working Papers hal-03459272, HAL.
    3. Li, Shaofang & Marinč, Matej, 2016. "Competition in the clearing and settlement industry," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 40(C), pages 134-162.
    4. Troels Krarup, 2016. "Economic Discourse and the European Integration of Financial Infrastructures and Financial Markets," Sciences Po Economics Publications (main) hal-03459272, HAL.
    5. Catherine Karyotis, 2010. "Rétrospective et perspective : six décennies de comptes courants de titres," Revue d'Économie Financière, Programme National Persée, vol. 97(2), pages 71-85.
    6. repec:spo:wpmain:info:hdl:2441/5roa67nl3t9vmaafofq0ug2d9d is not listed on IDEAS
    7. Martin, Antoine & McAndrews, James, 2010. "A study of competing designs for a liquidity-saving mechanism," Journal of Banking & Finance, Elsevier, vol. 34(8), pages 1818-1826, August.
    8. Li, Shaofang & Marinč, Matej, 2018. "Economies of scale and scope in financial market infrastructures," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 53(C), pages 17-49.
    9. Son, Bumho & Jang, Huisu, 2023. "Economics of blockchain-based securities settlement," Research in International Business and Finance, Elsevier, vol. 64(C).
    10. Milne, Alistair, 2007. "The industrial organization of post-trade clearing and settlement," Journal of Banking & Finance, Elsevier, vol. 31(10), pages 2945-2961, October.
    11. Baris Serifsoy, 2008. "Demutualization, outsider ownership, and stock exchange performance: empirical evidence," Economics of Governance, Springer, vol. 9(4), pages 305-339, October.
    12. M. Moses Antony RAJENDRAN, & Alexandru Mircea Nedelea, 2017. "Re - Modeling Of Global Financial Markets, Assets And Services Of Financial Institutions For Public Benefits," EcoForum, "Stefan cel Mare" University of Suceava, Romania, Faculty of Economics and Public Administration - Economy, Business Administration and Tourism Department., vol. 6(1), pages 1-57, January.
    13. Krarup, Troels, 2016. "Economic discourse and the European integration of financial infrastructures and financial markets," MaxPo Discussion Paper Series 16/2, Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo).
    14. Frédéric Cherbonnier & Séverine Vandelanoite, 2007. "Enjeux économiques liés à l’intégration des industries du post-marché en Europe," Revue d'Économie Financière, Programme National Persée, vol. 89(3), pages 123-142.

    More about this item

    JEL classification:

    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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