The Transmission of US Business Cycles to the Canadian Economy

Koichi Yoshimine

International Economic Journal, 2010, vol. 24, issue 2, 155-170

Abstract: As the substantial share of the Canadian trade occurs with the United States, one would expect that the fluctuations in US macroeconomic aggregates are rapidly transmitted to the Canadian economy. Specifically, the transmission should occur through changes in the flow of goods and financial assets. However, the standard general equilibrium models fail to show such a relationship. In this paper, I consider a small open-economy model taking the fluctuations of US variables as given and explicitly incorporating the flows of intermediate goods and financial assets. The simulation results show that the model can reproduce the actual data reasonably well when the trade share of intermediate goods is properly calibrated and the flow of financial asset is absent. That is, transmission does occur through trade in goods but not through assets.

Keywords: International business cycles; international transmissions; small open economy (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/10168737.2010.486886 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:intecj:v:24:y:2010:i:2:p:155-170

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RIEJ20

DOI: 10.1080/10168737.2010.486886

Access Statistics for this article

International Economic Journal is currently edited by Jaymin Lee Editor

More articles in International Economic Journal from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().