BUSINESS CYCLE SYNCHRONIZATION BETWEEN ROMANIA AND THE EURO AREA. A FRESH LOOK IN VIEW OF THE RECENT CRISIS

Ileana Alexe and Cristina Flavia Tatomir
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Ileana Alexe: Academy of Economic Studies, Bucharest
Cristina Flavia Tatomir: Academy of Economic Studies, Bucharest

Revista Economica, 2012, vol. Supplement, issue 1, 9-18

Abstract: This paper examines the degree of business cycles synchronization between Romania and the Euro area, by using Germany as a benchmark for the area economic cycle. The period of the study is 2000 - 2011, with a special emphasis on the recent economic and financial crisis. Using the Hodrick-Prescott filter, we find important, but decreasing correlations in times of crisis in the level of GDP. Furthermore, the analysis by GDP components reveals that private consumption remains the least correlated with the Euro area, while foreign trade is highly correlated and its synchronization even increased during the recent crisis.

Keywords: Optimum currency area; Business cycle synchronization; Romania; Euro area; Crisis (search for similar items in EconPapers)
JEL-codes: E32 F15 F41 (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:blg:reveco:v:supplement:y:2012:i:1:p:9-18

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