Date

4-2009

Degree

Bachelor of Science in Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Amelia L. Bello

Abstract

The study measured the degree of regional financial integration (RFI) of the Philippines with the Asia Pacific Economic Cooperation member economies using price- based measures (i.e., common financial market interest rates). Measurements of the financial integration were the mean differential of APEC member economies in relation to the Philippines and the Coefficient of Variation of APEC member economies. Money market, lending market and domestic deposit market rates were used in the study. The findings suggest that there is already an increased integration of financial markets of APEC prior to its formation. Also, during the most recent years, there is observed movement of the APEC unit market rate towards a more financially integrated region. Moreover, the study discussed the RFI’s implications to economic growth (i.e., growth rate of real GDP per capita) and assessed the RFI’s effects on domestic financial development. Measures used in financial development were bank deposits as percent of GDP, value of money and quasi-money supply as percent of GDP, private credit as percent of GDP and stock activity as percent of GDP. Indicators of the lending market rate and deposit market rate integration were significant in the growth model. However, results of the study showed that financial integration may actually be detrimental to economic growth. Money market rate integration was found to be significant in relation to the levels of financial development in the country. Contrary to existing economic theories, it was found out that there are adverse effects of increased financial integration with the levels of financial development present in the country.

Language

English

Call Number

LG 993.5 2009 E2 B47

Document Type

Thesis

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