What good is financial integration in Asia?


Event details


Date & time

Tuesday 06 April 2010


Molonglo Theatre, J G Crawford Building 132, Lennox Crossing, ANU


Professor Jenny Corbett


Henry Keenan
6125 5559
Current discussion of closer regional integration is usually vague on details. Much recent policy focus has been on the architecture in the region: which organisation should do what and why we need more, or fewer, groupings. The politics of competing proposals make good press but tell us relatively little about the economic function of closer regional integration. Academic research has covered the question of the advantages, or otherwise, of regional trade agreements because trade questions lend themselves to analysis by computable models. For finance there is less clarity. After the Asian financial crisis of 1997 there was a flurry of activity to establish the currency swap agreement known as the Chiang Mai initiative, and to create a regional bond market, but most top-down calls for closer financial integration and more open financial markets receive a lukewarm response from governments in the region. This seminar will discuss the difficulties of definition and measurement and what is known about the region’s degree of financial integration. It questions the economic benefits from closer integration and how these can be captured and by whom. Does financial integration protect economies from shocks to production and consumption, or increase them? Would it increase investment or financial efficiency? Would it help “growth rebalancing”? Is the logical conclusion a monetary union for Asia?
Professor Jenny Corbett is the Executive Director of the Australia-Japan Research Centre, Crawford School of Economics and Government at the Australian National University and the Associate Dean for Research in the College of Asia and the Pacific, ANU. She is also Reader in the Economy of Japan at the University of Oxford and a Research Fellow of the Centre for Economic Policy Research (CEPR, London).

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