Can Regional Cross-listings Accelerate Stock Market Development? Empirical Evidence from Sub-Saharan Africa

December 1, 2008

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Can Regional Cross-listings Accelerate Stock Market Development? Empirical Evidence from Sub-Saharan Africa, (USA: International Monetary Fund, 2008) accessed December 22, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This study analyzes the impact of regional cross-listing of stocks on the depth of the stock markets in sub-Saharan Africa (SSA). It analyzes data from 1990 to 2007 for a panel of 13 stock markets in SSA countries, only some of which have regional cross-listings. Using event study methodology, the paper finds significant positive effects in measures of stock market depth around regional cross-listing events. Overall, growth in the regional crosslisting of stocks facilitates stock market deepening, and the stock markets of countries with regional cross-listings perform better than those without. The study thus suggests that SSA countries can benefit from putting in place the necessary conditions for promoting regional cross-listings and thereby deepening their stock markets. These include sound legal and regulatory frameworks, macroeconomic and political stability, harmonization of listing rules, accounting laws and disclosure requirements across the region, and strong money markets.

Subject: Emerging and frontier financial markets, Market capitalization, Regional integration, Stock markets, Stocks

Keywords: Firm, GDP, Listed firm, Stock, WP

Publication Details

Pages:

44
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2008/281
Stock No:

WPIEA2008281
ISBN:

9781451871395
ISSN:

1018-5941

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