The technological transformation of capital markets

Diaz-Rainey, I, Ibikunle, G and Mention, A-L 2015, 'The technological transformation of capital markets', Technological Forecasting and Social Change, vol. 99, pp. 277-284.


Document type: Journal Article
Collection: Journal Articles

Title The technological transformation of capital markets
Author(s) Diaz-Rainey, I
Ibikunle, G
Mention, A-L
Year 2015
Journal name Technological Forecasting and Social Change
Volume number 99
Start page 277
End page 284
Total pages 8
Publisher Elsevier
Abstract Technology has dramatically altered capitalmarkets over the past few decades. Technologically induced innovations such as electronic exchanges, high frequency trading (HFT) and exchange traded funds (ETFs) have made trading in capital markets faster, cheaper and more integrated, yet at the same timemarket liquidity has become more fragmented and opaque. Further, there are concerns that this new paradigmleads to greater volatility and myopia in the core function of finance (raising capital for entrepreneurial activity). Capital markets are clearly complex adaptive techno-social systems that are undergoing dramatic changes yet they are rarely researched from an innovation research or technological change perspective. In this editorial, we introduce the themes and issues highlighted by the papers in this Special Issue that addresses this gap in the literature. The contributions illuminate the technologies and related innovations that are changing the nature of capital markets. However, technology cannot be seen in isolation fromother forces, most notably regulation, organisational innovation and new entrants.Moreover, technology is not only changing existingmarkets, it is expanding the scope of markets. Thuswe conclude that financialization (the process bywhich financialmarkets become increasingly important in the economy and society) is a technology enabled phenomenon-something hitherto largely overlooked by the financialization literature.
Subject Innovation and Technology Management
Keyword(s) Financial markets
Information technology
High frequency trading
Financialization
Electronic exchanges
Financial innovation
DOI - identifier 10.1016/j.techfore.2015.08.006
Copyright notice © 2015 Elsevier Inc.
ISSN 0040-1625
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