This article examines the degree of integration among the financial markets in South Asia at regional and extra-regional levels by using monthly data collected for the period 2010–2018. It uses autoregressive distributed lag (ARDL) bounds test approach of cointegration, and short-run causalities are obtained under the error correction framework. The bounds testing procedure finds the existence of long-run relations among the four markets when the equity market of India is taken as the dependent variable. Although the bounds testing procedure finds some evidence of integration at the regional level, evidence suggests that integration at the global level is much higher than the integration at the regional level for this region. Another interesting finding is that Pakistan does not exhibit cointegrating relations with the rest of the equity markets in South Asia, and results are inconclusive when developed countries’ equity markets are introduced to the estimated models, which can be attributed to the political instability that Pakistan is consistently plagued with and also its strained relationship with India, thereby hampering capital inflows.

本文通过使用2010-2018年期间每月收集的数据，研究了区域和区域外南亚金融市场之间的整合程度。它使用协整的自回归分布滞后（ARDL）边界测试方法，并且在误差校正框架下获得了短期因果关系。当将印度的股票市场作为因变量时，边界检验程序会发现四个市场之间存在长期关系。尽管边界测试程序找到了一些在区域层面进行整合的证据，但证据表明，该区域在全球层面的整合远高于在区域层面的整合。