Financial integration in Asia: some empirical evidence

We investigate the degree and evolution of financial integration for 11 Asian equity markets for the period 2002-2018, using daily returns. We split up the sample period in three sub-periods to separately account for the impact of the Global Financial Crisis (GFC), and also distinguish between three country groups, corresponding to their level of economic development. Using four measures of financial integration, we find that the level and speed of financial integration corresponds to the level of economic development. In addition, we find a steady evolution of financial integration when the GFC is appropriately accounted for. The crisis period itself yields mixed results, leading to caution in using this period for the analysis of financial integration