The Historical Dynamics of Financial Exchanges

47 Pages Posted: 5 Sep 2011 Last revised: 7 Feb 2019

See all articles by Bjorn Jorgensen

Bjorn Jorgensen

Kenneth A. Kavajecz

Edgewood College; Phoenix Rising Advisory

Scott N. Swisher

Cambridge University - Faculty of Economics

Date Written: February 5, 2019

Abstract

The historical dynamics of entry and exit in the financial exchange industry are analyzed for a panel of 741 exchanges in 52 countries from 1855 through 2012. We focus on economic, technological, and regulatory factors. Using novel panel data evidence, we empirically test whether these factors are consistent with existing financial theories. We find that US exchanges are 4.6% more likely to exit per year after the passage of the Securities Exchange Act. The telephone, literacy, and regulation are robust predictors of financial exchange dynamics. The upward trend in literacy is an important driver of exchange entry.

Keywords: Financial exchanges, entry, exit, mergers, hazard model

JEL Classification: N20, G15, L51, F36

Suggested Citation

Jorgensen, Bjorn N and Kavajecz, Kenneth A. and Swisher, Scott N., The Historical Dynamics of Financial Exchanges (February 5, 2019). Available at SSRN: https://ssrn.com/abstract=1922250 or http://dx.doi.org/10.2139/ssrn.1922250

Kenneth A. Kavajecz (Contact Author)

Edgewood College ( email )

1000 Edgewood College Dr.
Madison, WI 53711
United States
6087704677 (Phone)

Phoenix Rising Advisory ( email )

519 NORTH PINCKNEY STREET
MADISON, WI 53703
United States
6087704677 (Phone)

HOME PAGE: http://www.pr-advisory.com

Scott N. Swisher

Cambridge University - Faculty of Economics ( email )

Sidgwick Avenue
Cambridge, CB3 9DD
United Kingdom

No contact information is available for Bjorn N Jorgensen

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