@techreport{Serifsoy2005Business,
abstract = {In recent years stock exchanges have been increasingly diversifying their operations
into related business areas such as derivatives trading, post-trading services and
software sales. This trend can be observed most notably among profit-oriented
trading venues. While the pursuit for diversification is likely to be driven by the
attractiveness of these investment opportunities, it is yet an open question whether
certain integration activities are also efficient, both from a social welfare and from
the exchanges' perspective. Academic contributions so far analyzed different business
models primarily from the social welfare perspective, whereas there is only little
literature considering their impact on the exchange itself. By employing a panel data
set of 28 stock exchanges for the years 1999-2003 we seek to shed light on this topic
by comparing the factor productivity of exchanges with different business models.
Our findings suggest three conclusions: (1) Integration activity comes at the cost of
increased operational complexity which in some cases outweigh the potential
synergies between related activities and therefore leads to technical inefficiencies and
lower productivity growth. (2) We find no evidence that vertical integration is more
efficient and productive than other business models. This finding could contribute to
the ongoing discussion about the merits of vertical integration from a social welfare
perspective. (3) The existence of a strong in-house IT-competence seems to be
beneficial to overcome lower productivity growth associated with complex business
models.},
author = {Baris Serifsoy},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {C61; C24; F39; C23; G32; 330; exchanges; demutualization; post-trading; derivatives; software; DEA; Malmquist-Productivity; bootstrapping; Wertpapierb\"{o}rse; Diversifikation; Gesch\"{a}ftsmodell; Wirtschaftliche Effizienz; Sch\"{a}tzung; Welt},
language = {eng},
number = {158},
title = {Business Models and Stock Exchange Performance - Empirical Evidence},
type = {Working paper series / Johann-Wolfgang-Goethe-Universit\"{a}t Frankfurt am Main, Fachbereich Wirtschaftswissenschaften : Finance & Accounting},
url = {http://hdl.handle.net/10419/23423},
year = {2005}
}
