Summary Closing Considerations and Recommendations

Past results are not an exclusive indicator of future performance and should be viewed in the context of the operating environment in these markets. Nevertheless, as one may ignore the financial system environment learnings, at some point one will not be able to ignore the consequences of an ignored reality. This research raises awareness of the diversified financial system environment’s characteristics, of opportunities, and of caveats unquestionably seeking adaptation in the selected Southeast European capital markets. Due to increased uncertainty of efforts to foster innovative financial products, claims that a smaller capital market economy cannot be competitive versus market “Goliaths,” and that large or advanced market failures are necessarily hereditary to developing markets should be thoroughly questioned. Where deep capital electronic markets exhibit overextended moves in frenzy times (Kleinman, 2013), a nascent, smaller capital market may be naturally hedged and thus serve as a global example of a better-struck balance. For Southeast Europe the statistical results of the panel pooled mean group statistical test confirm the inexistence of statistically significant linear relationship and of short-run cointegrating relationships. Nonetheless, statistical testing techniques and methodologies have limited capacities and the results should be observed with this constraint in mind, while it is critical to also understand the operating market environment which is assessed in detail. In-depth structural and environment assessment shows that in their inherent interconnectedness Southeast European markets also turn to cooperation in harmonizing conditions with standards of the European Union. This study reveals the necessity to improve transparency, corporate governance, and judicial effectiveness in order to increase integration of stakeholders and an improved access to and use of capital through innovative direct markets.