Determinants of Business Cycle Comovement: A Robust Analysis / Marianne Baxter, Michael A. Kouparitsas.

Format:

Book

Author/Creator:

Baxter, Marianne.

Contributor:

National Bureau of Economic Research.

Kouparitsas, Michael A.

Series:

Working Paper Series (National Bureau of Economic Research) no. w10725.

NBER working paper series no. w10725

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Determinants of Business Cycle Comovement

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2004.

Summary:

This paper investigates the determinants of business cycle comovement between countries. Our dataset includes over 100 countries, both developed and developing. We search for variables that are robust' in explaining comovement, using the approach of Leamer (1983). Variables considered are (i) bilateral trade between countries; (ii) total trade in each country; (iii) sectoral structure; (iv) similarity in export and import baskets; (v) factor endowments; and (vi) gravity variables. We find that bilateral trade is robust. However, two variables that the literature has argued are important for business cycles industrial structure and currency unions are found not to be robust.

Notes:

Print version record

September 2004.