Electronic trading and stock market participation in Africa: Does technology induce participation?

Adamolekun, Gbenga; Sakariyahu, Rilwan; Lawal, Rodiat; Ahmed, Ammar

Abstract

This study examines the effect of migrating to electronic trading platforms on stock market participation among African stock exchanges. Using Bayesian estimations, we demonstrate that transitioning from a physical to an electronic stock exchange decreases trading activity on the stock exchange whilst increasing listing. Our findings further reveal that the impact of migration is more pronounced for non-Sub-Saharan African countries relative to Sub-Saharan countries. In terms of policy, the results imply that African exchanges cannot optimise the efficiency of their stock markets simply by migrating to electronic trading platforms.

Citation

Adamolekun, G., Sakariyahu, R., Lawal, R., & Ahmed, A. (2023). Electronic trading and stock market participation in Africa: Does technology induce participation?. Economics Letters, 224, Article 110991. https://doi.org/10.1016/j.econlet.2023.110991

• Journal Article Type: Article
• Acceptance Date: Jan 16, 2023
• Online Publication Date: Jan 24, 2023
• Publication Date: 2023-03
• Deposit Date: Feb 1, 2023
• Publicly Available Date: Feb 1, 2023
• Journal: Economics Letters
• Print ISSN: 0165-1765
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 224
• Article Number: 110991
• DOI: https://doi.org/10.1016/j.econlet.2023.110991
• Keywords: Stock market participation, Electronic trading platform, Africa, Sub-Saharan Africa, Technology