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China's financial market integration with the world

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  • Anders Johansson

Abstract

It is commonly argued that China's financial markets are effectively insulated from the rest of the world. To see if this is true, and to better understand China's financial development, we analyse China's integration with major financial markets. Using conditional copulas, we show that China has experienced an increasing level of integration with several major financial markets during the last decade, albeit at a slow pace and from very low levels. Furthermore, the level of integration has increased with several major markets during the global financial crisis. The results and possible reasons for the increasing integration are analysed and the implications for policymakers and market participants are discussed.

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File URL: http://www.tandfonline.com/doi/abs/10.1080/14765284.2010.493642
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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Journal of Chinese Economic and Business Studies.

Volume (Year): 8 (2010)
Issue (Month): 3 ()
Pages: 293-314

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Handle: RePEc:taf:jocebs:v:8:y:2010:i:3:p:293-314

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Related research

Keywords: China; financial market integration; co-dependence; Copula;

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Citations

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Cited by:
  1. Li, Hong, 2013. "Integration versus segmentation in China's stock market: An analysis of time-varying beta risks," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 25(C), pages 88-105.
  2. Goh, Jeremy C. & Jiang, Fuwei & Tu, Jun & Wang, Yuchen, 2013. "Can US economic variables predict the Chinese stock market?," Pacific-Basin Finance Journal, Elsevier, vol. 22(C), pages 69-87.
  3. Johansson, Anders C., 2010. "China’s Growing Influence in Southeast Asia - Monetary Policy and Equity Markets," Working Paper Series 2010-16, China Economic Research Center, Stockholm School of Economics.

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