Do financial systems converge? New evidence from financial assets in OECD countries

Giuseppe Bruno, Riccardo De Bonis and Andrea Silvestrini

Journal of Comparative Economics, 2012, vol. 40, issue 1, 141-155

Abstract: The objective of this paper is to study the issue of convergence of financial systems through the lens of asset allocation. It examines β- and σ-convergence of the most important financial instruments: deposits, debt securities, shares and insurance products. The analysis is conducted on two panels of OECD countries, using data gathered from the flow of funds and from the Financial Development and Structure Database (Beck et al., 2009). In both data sets, strong evidence supports the existence of β-convergence of shares and insurance products, confirming an increasing importance of capital markets all over the developed world. In contrast, mixed results are obtained for debt securities and deposits due to differences across countries in the weight of national public debts and in the role of banks.

Keywords: Financial systems; β- and σ-convergence (search for similar items in EconPapers)
JEL-codes: F36 G10 G20 O16 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (354)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:40:y:2012:i:1:p:141-155

DOI: 10.1016/j.jce.2011.09.003

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