Listing BRICs : Stock Issuers from Brazil, Russia, India and China in New York, London, and Luxembourg

In the last decade hundreds of companies from emerging markets have listed and issued their shares on American and European stock markets. Brazil, Russia, India, and China have been the main origins of issuers, and stock exchanges in the US, UK, and Luxembourg the main destinations involved in the process. These four home and three host markets are the empirical focus of our paper. We present an economic geography perspective on foreign listing, grounded in the geography of finance and the world city network approaches, emphasising the sub-national origins of foreign listed firms, the role of intermediaries, and competition for foreign listings. Our analysis, based on comprehensive up-to-date datasets on foreign listings and foreign equity issues, shows that issuers listing their shares abroad are predominantly large firms, coming from relatively high-growth, internationally oriented sectors, and headquartered overwhelmingly in the leading economic centres of their home countries. Key intermediaries in the foreign listing process are the global investment banks, operating out of the very same centres where the cross-listing firms and the host stock exchanges are located. Competition between host stock markets is affected significantly by the direct and indirect costs of foreign listing, including disclosure and corporate governance requirements. Both host markets and intermediaries exhibit a significant degree of specialisation in terms of the size, sector, and geographical origin of the issuers they serve. The market for foreign listing differs significantly between the BRIC countries, with the Chinese market offering the greatest potential, but facing considerable uncertainty