Measuring the degree of financial integration of bond markets: A study on the ASEAN-5 and selected developed countries from 2003-2011

• Main Authors: Ang, Kelvin Edmund, Diu, Charles Gerson, Tolentino, Janine Patricia
• Format: text
• Language: English
• Published: Animo Repository 2012
• Subjects: Bond market; Financial institutions > Management; Finance and Financial Management
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/18474
• Institution: De La Salle University

The degree of financial market integration increased significantly since the mid-1980s fueled by the recent waves of financial globalization, rise in capital flows, and technological advances. In the process, developing countries encourage capital openness through financial liberalization, larger cross-border capital flows, among others, with the belief that it promotes higher growth. In this paper, the researchers investigate the degree of financial market integration in ASEAN-5 and selected developed countries by examining amongst their bond markets through employing econometric techniques of correlation, cointegration, and causality. The study intends to answer the following questions: (1) What is the state of the bond market integration in the ASEAN and developed markets such as the United Sates, Germany, and the United Kingdom? (2) What effects did the 2008 global financial crisis have to the integration? This study has a strong implication to the international diversification, policy makers, academe, and future researchers. The researchers found that there is a low degree of integration among the countries. Furthermore, the global financial crisis has a short-term effect to the degree of bond market integration.