IS FINANCIALIZATION EFFECT DETECTABLE WITHIN INTERNATIONAL OIL MARKETS?

Over the past two decades increasing transformations involving the commodities pricing mechanisms jointly with relevant innovations introduced in financial markets spurred controversial issues both among policy-makers, practitioners and scholars about resulting overall effects on the economy. Common explanations advocated by experts are focused on two main features: increasing hypertrophic financialization of commodity markets and structural economic factors linked to traditional supply-demand imbalances. Oil markets have been an early example of this trend. In the present paper, with the aim to contribute to the discussion, a cross-correlation function (ccf) is applied to financial variables (Stock Exchange Indexes and main international quoted oil prices) to investigate the dynamic relationship depicting the potential existing mechanism. In order to propose a relevant analysis, data pertaining some industrialized Countries (Germany, United Kingdom and United States) as well as some important developing Countries (Brazil, China and India) are processed.