{
  "title": "Economic Integration and Financial Stability: A European Perspective",
  "publication": "IMF Working Papers, December 1, 2006",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/economic-integration-and-financial-stability-a-european-perspective-20078",
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  "summary": "This paper assesses changes in synchronization of real activity and financial market integration in Western Europe and evaluates their implications for financial stability.",
  "sections": [
    {
      "heading": "Executive summary",
      "content": "- This paper assesses changes in synchronization of real activity and financial market integration in Western Europe and evaluates their implications for financial stability.\n- Key high-level conclusions:\n  - Increased synchronization of real activity since the early 1980s.\n  - Increased equity markets integration since the early 1990s.\n  - Measures of systemic risk at large European financial institutions have not declined during the period 1990-2004.\n  - Bank systemic risk profiles have converged.\n  - The sensitivity of bank and insurance systemic risk measures to common real and financial shocks has increased in most countries.\n  - Overall conclusion: the integration process does not necessarily entail an unambiguously positive effect on financial stability."
    },
    {
      "heading": "Findings on real activity and financial market integration",
      "content": "- Real activity synchronization:\n  - Finding: increased synchronization of real activity since the early 1980s.\n- Equity markets integration:\n  - Finding: increased equity markets integration since the early 1990s."
    },
    {
      "heading": "Systemic risk measures and dynamics (1990-2004)",
      "content": "- Systemic risk levels:\n  - Finding: measures of systemic risk at large European financial institutions have not declined during the period 1990-2004.\n- Convergence:\n  - Finding: bank systemic risk profiles have converged.\n- Sensitivity to common shocks:\n  - Finding: the sensitivity of bank and insurance systemic risk measures to common real and financial shocks has increased in most countries."
    },
    {
      "heading": "Implications for financial stability and policy-relevant insights",
      "content": "- Integration and stability:\n  - Insight: increased economic and financial integration does not guarantee improved financial stability; effects are not unambiguously positive.\n- Risk interdependency:\n  - Insight: rising synchronization and market integration, together with converging bank risk profiles and greater sensitivity to common shocks, increase interdependency of risks across institutions and countries.\n\n---\n\n Content in this bundle\n\n- 3.         Insurance         DDs\n  - 3.         Insurance         DDs (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - 3.         Insurance         DDs (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/economic-integration-and-financial-stability-a-european-perspective-20078"
    }
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    "Authors: Gianni De Nicolo, Alexander F. Tieman",
    "Published: December 1, 2006",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451865561.001",
    "This paper assesses changes in synchronization of real activity and financial market integration in Western Europe and evaluates their implications for financial stability.",
    "Key high-level conclusions:",
    "Real activity synchronization:",
    "Equity markets integration:",
    "Systemic risk levels:",
    "Convergence:",
    "Sensitivity to common shocks:",
    "Integration and stability:",
    "Risk interdependency:",
    "**3.         Insurance         DDs**"
  ],
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