Integration to international financial markets and consumption smoothing : recent evidence from Latin America Integration to international financial markets (IIFM) in Latin America has not been easy. The experience reviewed of Argentina, Brazil, Chile and Mexico shows that financial integration is not an easily achieved goal. The institutional framework and the macroeconomic and financial policies affect the sustainability of integration. There are three approaches to assess the effect of IIFM on economic performance. One is via a decrease in the cost of borrowing in international markets compared with autarchy. The other is that IIFM could also be a channel for economic growth as it may affect productivity growth. We examine a third approach, the impact of IIFM in terms of allowing for a more smoothed consumption path. We find that consumption volatility has decreased in Brazil, Chile and Mexico, countries that have been consistently improving their IIFM, while it has increased in Argentina, country that after the end of its fixed exchange rate experiment, has been detaching itself from international financial markets. In the context of the global financial crisis, the paper shows that financial integration can deliver tangible benefits, provided appropriate institutions and macroeconomic policies are in place. Classification JEL : E2, E6, F3, O1, O54.