The determinants of international financial integration revisited: the role of networks and geographic neutrality
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Other documents of the author: Arribas, Iván; Pérez García, Francisco; Tortosa-Ausina, Emili
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comunitat-uji-handle2:10234/8643
comunitat-uji-handle3:10234/8644
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INVESTIGACIONMetadata
Title
The determinants of international financial integration revisited: the role of networks and geographic neutralityDate
2011-01Publisher
Walter de GruyterISSN
1081-1826; 1558-3708Bibliographic citation
Studies in Nonlinear Dynamics & Econometrics (Jan. 2011), vol. 15, no. 1Type
info:eu-repo/semantics/articleVersion
info:eu-repo/semantics/submittedVersionSubject
Abstract
Over the last two decades, the degree of international financial integration has increased substantially,
becoming an important area of research for many financial economists. This paper explores
the determinants ... [+]
Over the last two decades, the degree of international financial integration has increased substantially,
becoming an important area of research for many financial economists. This paper explores
the determinants of the asymmetries in the international integration of banking systems. We consider
an approach based on both network analysis and the concept of geographic neutrality. Our analysis
focuses on the banking systems of 18 advanced economies from 1999 to 2005. Results indicate that
banking integration should be assessed from the perspective of both inflows and outflows, given that
they show different patterns for different countries. The parametric techniques point out the remarkable
role of both geographic distance and trade integration. However, the most relevant results are
yielded by nonparametric techniques, which we use due to the lack of well-established results on the
determinants of trade in assets. These techniques reveal that the effect of the covariates on banking
integration is not constant over the conditional distribution which (in practical terms) implies that
the sign of the relationship varies across countries. [-]
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