Siklos: No Coupling, No Decoupling, Only Mutual Inter-Dependence: Business Cycles in Emerging vs. Mature Economies

​Tuesday

24.4.2012

at 10.30

 

Pierre L. Siklos, Department of Economics, Wilfrid Laurier University & Viessmann European Research Centre: No Coupling, No Decoupling, Only Mutual Inter-Dependence: Business Cycles in Emerging vs. Mature Economies

 

 

 

ABSTRACT

Even before the events of the past few years, economists and policy makers were musing about the apparent contradiction between globalization, as it is generally understood, and the seemingly different paths in overall economic activity taken by the emerging and more mature economies of the world. The present paper reconsiders whether it is, in fact, useful to think of correlations in business cycle movements as reflecting some form of coupling or decoupling and, instead, suggests that, even if business cycles may well have become more synchronous for a time, it is more useful to think of international business cycle co-movements as reflecting their mutual dependence that can be subjected to short-run interruptions or affected by a variety of other economic factors. I report evidence based on factor-augmented quantile regressions for a panel of annual data since 1980 from 9 regions of the world. A panel is used to estimate the common factors which are then applied to the quantile regression model to determine the sources of business cycle co-movements across countries and regions of the world.

 

JEL Classification numbers: E32, C21, C22, C23

Keywords: business cycles, quantile regression, panel estimation, factor model, coupling, decoupling

 

The seminars are open to all economists interested in the subject areas covered.

You need to pre-register for the seminar with

Ms Liisa Mannila  (firstname.lastname@bof.fi, phone  + 358 10 831 2268).

 

Seminar will be held at Rauhankatu 19, 3rd floor seminar room (arrive at the Bank's Rauhankatu 19 entrance, from where you will be escorted to the BOFIT seminar room).