Does regulatory cooperation help integrate equity markets?

Roger Silvers

Journal of Financial Economics, 2021, vol. 142, issue 3, 1275-1300

Abstract: This study tests whether cooperation between securities regulators influences global market integration. I measure cooperation using arrangements between securities regulators that enable enhanced cross-border enforcement, better regulatory decisions, and reduced compliance obligations for cross-border activities. These arrangements-formed at different times for different country pairs-are associated with an 11% increase in cross-border investment. I find similar increases using other proxies for market integration. Cross-border investment and market integration thus depend, in part, on regulators working together to extend legal and institutional capacities across borders. This reframes our understanding of the role of institutions in global capital markets.

Keywords: Cross-border cooperation; Regulatory networks; Market integration; Capital flows; Institutions (search for similar items in EconPapers)
JEL-codes: E02 E44 F21 F36 F37 F42 F55 G15 K42 N2 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jfinec:v:142:y:2021:i:3:p:1275-1300

DOI: 10.1016/j.jfineco.2021.05.040

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