Analysis of the Asia~Pacific Region's Corporate Presence in the Americas in Context to the Congruence of Their Stock Markets and Economies

Abstract

The purpose of this study is to provide a contribution to the analysis of foreign cross-listing behaviour in general, and on the state of the integration of the Asian-Pacific region's capital markets and economies in specific; while also examining the market preferences of Asian-Pacific firms in the Americas and around the world in the context of their integration within the Americas. A logistic regression model is developed which takes into consideration exchange, firm, geographic, and industrial regressors in order to determine whether firms prefer listing on which American stock exchanges. Logistic regressions are also run on foreign corporations operating in the Asia-Pacific region. Unit-root causality tests and ARCH regressions are run on the economic specific characteristics of the Asian-Pacific economies to analyse currency union and finance market integration possibilities. The Asian-Pacific governments do look to their home exchanges first for their financing needs, though the Asian-Pacific governments then look to the world capital markets before the regional capital markets, which demonstrates an operating efficiency by the Asian-Pacific governments in the capital markets. That said, the Asian-Pacific markets are arguably not as established as the European markets, and thus using the European markets may in fact be more efficient for the Asia-Pacific countries.