Reshaping financial systems. New technologies and financial innovations - evidence from the United States, Mexico and Brazil
The paper unveils whether ICT diffusion determines development of financial innovation in emerging economies. Particularly, we examine the impact of ICT adoption on changing values of exchange traded funds in Brazil and Mexico, comparing it to the United States as reference country (benchmark). Our methodological framework includes descriptive statistics, logistic growth models (used to estimate ETFs growth) and generalized linear models (used to check for relationship between ICT adoption and ETFs value). In each case we run country-specific estimates. Data on ICT adoption (approximated by Internet Users and Fixed Broadband Subscriptions) are exclusively derived from World Telecommunication/ICT Indicators Database 2012 (16th edition), and exchange traded funds from funds’ providers and reports published by BlackRock. Analysis period is set for 2000-2012. Empirical findings collectively conclude that in all three countries, growth of ICT was pervasive, and this was accompanied by fast development of exchange traded funds in Mexico and in the United States, measured by increases in assets under management. Moreover, in the period 2002-2012 Mexico has caught up with the United States in terms of ETFs share in total investment funds (sum of assets of ETFs and mutual funds). In Brazil, even though ETFs growth rates were high, in 2012 share of ETFs in investment funds remained at a relatively lower level of 0.17%. Additionally, the relationship between ICT adoption and ETFs development was reported as strong, positive and statistically significant in each of analyzed countries.
|Date of creation:||Jan 2014|
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- Ewa Lechman, 2013.
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- Ewa Lechman, 2013. "New technologies adoption and diffusion patterns in developing countries - an empirical study for the period 2000-2011," GUT FME Working Paper Series A 5, Faculty of Management and Economics, Gdansk University of Technology.
- Lechman, Ewa, 2013. "New technologies adoption and diffusion patterns in developing countries. An empirical study for the period 2000-2011," MPRA Paper 46074, University Library of Munich, Germany.
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- W. Scott Frame & Lawrence J. White, 2004. "Empirical Studies of Financial Innovation: Lots of Talk, Little Action?," Journal of Economic Literature, American Economic Association, vol. 42(1), pages 116-144, March.
- W. Scott Frame & Lawrence White, 2002. "Empirical Studies of Financial Innovation: Lots of Talk, Little Action?," Working Papers 02-18, New York University, Leonard N. Stern School of Business, Department of Economics.
- Geert Bekaert & Campbell R. Harvey & Christian Lundblad, 2007.
"Liquidity and Expected Returns: Lessons from Emerging Markets,"
Review of Financial Studies,
Society for Financial Studies, vol. 20(6), pages 1783-1831, November.
- Bekaert, Geert & Harvey, Campbell & Lundblad, Christian T, 2006. "Liquidity and Expected Returns: Lessons from Emerging Markets," CEPR Discussion Papers 5946, C.E.P.R. Discussion Papers.
- Geert Bekaert & Campbell R. Harvey & Christian Lundblad, 2005. "Liquidity and Expected Returns: Lessons From Emerging Markets," NBER Working Papers 11413, National Bureau of Economic Research, Inc.
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- repec:dau:papers:123456789/903 is not listed on IDEAS
- Laurent Deville, 2008. "Exchange Traded Funds: History, Trading and Research," Post-Print halshs-00162223, HAL.
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