Synchronization of the Polish and European Business Cycles

Dionysios Chionis and Costas Leon

The Journal of Economic Asymmetries, 2009, vol. 6, issue 1, 119-139

Abstract: We employ spectral and VAR methods with quarterly real GDP data to examine the synchronization between the European and the Polish business cycles. Our results show that both areas experience a common cycle at the frequency of 0.045 cycles (22 quarters or 5.5 years). Since the main question in the empirical analyses of the business cycle in a monetary union is whether the business cycles are synchronized, our findings confirm that both business cycles are dominated by the same frequency, but, there is a time lag between these two cycles. Therefore, the costs of participation in the monetary union, in comparison to the benefits, are not negligible.

Keywords: Business cycles; Optimum currency area; Economic fluctuations; Transmission of stochastic shocks; Poland; European Union; E32 (search for similar items in EconPapers)
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:eee:joecas:v:6:y:2009:i:1:p:119-139

DOI: 10.1016/j.jeca.2009.01.009

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