Author(s)

Houqiang Zhou

Corresponding Author

Houqiang Zhou

Abstract

Firstly, this paper presents a "two-stage" model measuring the degree of financial integration in a qualitative analysis. The first step of the model distinguishes the over-potential of global and regional financial integration through the setting of a dual model. Then, the new interest series extracted from this model are used as proxy variables of global information impact and regional information impact into the second step of the volatility spillover model to build the correlation between the rate of return of local financial assets and the impact of regional information. Based on the model, two stages of the financial integration of the regional financial integration are respectively measured: the financial integration of the "Guangdong-Hong Kong" special area is analyzed and the impact of the financial crisis and the reform of the exchange rate system on the process of financial integration is discussed.

Keywords

Financial Integration Level, Model Analysis, Regional Financial Development.