DP2473 Sectors and the OECD Business Cycle

Author(s): Jean Imbs
Publication Date: June 2000
Keyword(s): Economic Structure, International Business Cycles, Trade
JEL(s): E32, F41
Programme Areas: International Macroeconomics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=2473

This paper argues that economic structure is a robust determinant of the OECD business cycle. Countries that share similar manufacturing sectors are shown to display more synchronized business cycles. Interestingly, the well-established rule of trade impacting on rich countries' business cycles is thus mitigated, and its direct impact lessened. The structure of sectoral output also goes some way towards explaining idiosyncracies in the UK business cycle.