DP8347 Business Cycle Synchronization Since 1880

Author(s):	Michael J Artis, George Chouliarakis, PKG Harischandra
Publication Date:	April 2011
Keyword(s):	business cycles, dynamic factor models, globalization, integration
JEL(s):	C32, E32, F41, N10
Programme Areas:	International Macroeconomics
Link to this Page:	cepr.org/active/publications/discussion_papers/dp.php?dpno=8347

This paper studies the international business cycle behaviour across 25 advanced and emerging market economies for which 125 years of annual GDP data are available. The picture that emerges is more fragmented than the one drawn by studies that focused on a narrower set of advanced market economies. The paper offers evidence in favour of a secular increase in international business cycle synchronization within a group of European and a group of English-speaking economies that started during 1950-1973 and accelerated since 1973. Yet, in other regions of the world, country-specific shocks are still the dominant forces of business cycle dynamics.