Asian Financial Integration: Trends and Interruptions
January 1, 2011
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Summary
The paper compares trends in financial integration within Asia with those in industrialized countries and other regional groups. Declines in cross-country dispersion in equity returns and interest rates suggest increased Asian integration, with the process interrupted by crises and global volatility. Cross-border equity and bond holdings have also increased, but Asian countries remain considerably more financially integrated with major countries outside the region than with those within the region. The paper also discusses whether potential benefits of regional financial integration, such as increased risk-sharing and stability of the investor base, have materialized.
Subject: Financial crises, Financial institutions, Financial integration, Financial markets, Securities, Stock markets, Stocks
Keywords: Asia, Asia and Pacific, bond markets, Eastern Europe, equity holdings equation, equity premium, Europe, exchange rate, financial crisis, financial integration, Global, gravity model, herding, home bias, investor base, investor economy, investors' choice, issuer economy Group, risk sharing, risk-sharing, Securities, Stock markets, Stocks, WP
Pages:
41
Volume:
2011
DOI:
Issue:
004
Series:
Working Paper No. 2011/004
Stock No:
WPIEA2011004
ISBN:
9781455211821
ISSN:
1018-5941
