Global Financial Meltdown – Systematic Literature Review

Abstract

INTRODUCTION Salman Sarwat1 Syed Shabib ul Hasan2 1Faculty of Management Sciences, Barrett Hodgson University. Email: salman.sarwat@bhu.edu.pk, salmansarwat@hotmail.com) 2Department of Public Administration, University of Karachi. Economic or financial crises have become a recurrent feature of the contemporary economy. When we look back into the recent past, the wave of crises can be traced with the deregulation of financial markets in the 1970s. From the US stock market crash of 1973 to Global Financial Meltdown in 2008, financial innovations seemed to have been the most critical aspect to investigate. These financial innovations include financial integration, financial derivatives, and securitization, etc. For example, Ghysels and Seon (2005) have pointed out financial derivatives as the main culprit for the US stock market crash in the 1980s. Okina, et al. (2001) exhibited the involvement of hybrid instruments in fuelling the bubble of Japanese Asset