This paper assesses changes in synchronization of real activity and financial market integration in Western Europe and evaluates their implications for financial stability. We find increased synchronization of real activity since the early 1980s and increased equity markets integration since the...

Intro -- Economic Integration and Financial Stability: A European Perspective -- Contents -- I. INTRODUCTION -- II. SYNCHRONIZATION OF REAL ACTIVITY -- III. EQUITY MARKETS INTEGRATION -- IV. SYSTEMIC RISK AND INTEGRATION -- V. CONCLUSION -- Table 1. EGARCH Estimates for the Common Components of...