AN ANALYSIS OF FINANCIAL INTEGRATION :NOW AND THEN

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AN ANALYSIS OF FINANCIAL INTEGRATION:NOW AND THEN

Dr.Debesh Bhowmik

Key words- financial integration, history of financial integration,growth and financial integration,crises and financial integration.

JEL-E44,F15,F33,F41,G15,N10,O11

Abstract

The article endeavours to analyse on Financial integration which is a process through which a country’s financial markets become more closely integrated with those in other countries or with those in the rest of the world and which was also historically observed through domination of international trade and finance from the hands of Spain, Italy, Portugal, France ,England and USA and from one financial centre to other entrepot centres. Development of capitalism became unsuccessful in spite of introduction to globalization and financial integration because financial crises could not be avoided in course of accelerated financial integration although capitalism have spent the years of golden age as its success story of  international financial integration.The role of capital flows do not stimulate growth in all countries in all the periods where growth of FDI dominates in several sectors. Convergences in the indicators of financial integration process were not achieved even when trade integration showed successful. Thus,financial integration did not lead to expand growth in all countries when imbalance and financial crises were the outcome of integration and when international economy has no common international money with a stable exchange rate regime. 

[This paper was accepted for presentation in World Finance  Conference and Banking Symposium,Singapore on 12-13 December,2014.]