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We examine local and global equity market integration since 1900 using network methods. The analysis uncovers a new stylized fact about equity market integration over the past 120 years. Local equity market integration generally increases over the entire sample period. This finding is at odds with much of the existing literature that describes long-run market integration as following a U-shape pattern. Global stock market integration peaks in 1913 followed by disintegration during the Great Depression and Bretton Woods periods. Then it rebounds and achieves the highest level of integration during the recent period of globalization that began in the early 1970s. We argue that this U-shape pattern is the byproduct of the interaction of the network effects of the monotonic decrease of local distances (decrease in information costs, accelerated in the last decades) and network connectivity (which varies inversely with the control over international financial transactions).


This is the accepted version of the following article:

Bastidon, C., Bordo, M., Parent, A. and Weidenmier, M. (2023), Another History of Global Financial Markets: Local Stock Market Integration Since 1913 from a Network Perspective. World Econ. Accepted Author Manuscript.

which has been published in final form at This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Self-Archiving.

Peer Reviewed




Available for download on Monday, December 23, 2024