Expanding global financial integration at the periphery: the rising peril for frontier market economies

Luiz Fernando de Paula, Barbara Fritz and Daniela Magalhães Prates

Chapter 4 in Currency Hierarchy and Financial Globalisation, 2026, pp 81-105 from Edward Elgar Publishing

Abstract: This chapter provides a closer examination of the systematic differences between currencies at the bottom of the currency hierarchy. While most of the previous analysis has focused on emerging market economies (EMEs), in this chapter, we analyse the frontier market economies (FMEs), a group of countries, many of them in sub-Saharan Africa, that integrated into the global financial market after the global financial crisis of 2008. To better understand the specific fragility and vulnerability of this group of countries, we introduce the additional dimension of financial hierarchy, characterised by differentials in the level and volatility of yields of securities issued by EMEs and FMEs.

Keywords: Frontier market economies; Financial hierarchy; Benchmark-driven funds; Global financial shocks (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035328826
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