Economic Integration and Business Cycle Synchronization in Asia

Chi Gong and Soyoung Kim

Asian Economic Papers, 2013, vol. 12, issue 1, 76-99

Abstract: This paper examines the effects of internal (or regional) vs. external (inter-regional) integration and of trade vs. financial integration on regional business cycle synchronization in Asia. The empirical results show the following: (1) similar and strong common external linkages have significant positive effects on regional business cycle synchronization; (2) after controlling for external linkages, internal trade integration has a positive effect on regional business cycle synchronization but internal financial integration has a negative effect; and (3) the measures of external linkages, particularly the measure of external financial linkages, are more important than those of internal linkages in explaining regional business cycle co-movements. © 2013 The Earth Institute at Columbia University and the Massachusetts Institute of Technology.

Keywords: regional business cycle synchronization; Asia; internal and external integration; trade and financial integration (search for similar items in EconPapers)
JEL-codes: F4 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (11)

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