Global contagion of the U.S. financial crisis: An exploratory spatial data analysis

The global financial crisis originated from U.S. sub-prime loans and eventually became a global, systemic financial crisis that had swept the world's financial markets. However, the spatiotemporal pattern of the spread suggests no physical proximity alone able to provide sufficient explanation for the contagion process. The present study adapted the exploratory spatial data analysis by extending the concept of space from being purely physical to socioeconomic. Research results indicated that the contagion presented signs of dependence in both physical and socioeconomic space, with the latter having much stronger and more significant effects than the former. Such dependence is exactly a manifestation of the net contagion effect of a financial crisis transmission mechanism, a concept proposed by Masson and rarely verified in other studies.