China'S Financial Market Integration With The World
AbstractIt 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 analyze 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, even though the country's financial markets are commonly seen as being insulated. Furthermore, the level of integration has increased with several major markets during the current financial crisis. The results and possible reasons for the increasing integration are analyzed and the implications for policymakers and market participants are discussed.
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Bibliographic InfoPaper provided by China Economic Research Center, Stockholm School of Economics in its series Working Paper Series with number 2009-10.
Length: 27 pages
Date of creation: 01 Jun 2009
Date of revision:
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Postal: China, Economic Research Center, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden
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China; financial market integration; codependence; copula;
Other versions of this item:
- Anders Johansson, 2010. "China's financial market integration with the world," Journal of Chinese Economic and Business Studies, Taylor and Francis Journals, vol. 8(3), pages 293-314.
- F30 - International Economics - - International Finance - - - General
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-11 (All new papers)
- NEP-CNA-2009-07-11 (China)
- NEP-DEV-2009-07-11 (Development)
- NEP-TRA-2009-07-11 (Transition Economics)
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