Trade and Business Cycle Synchronization in OECD Countries - a Re-examination

Robert Inklaar, Richard Jong-A-Pin (), Jakob de Haan and Jakob de Haan

No 1546, CESifo Working Paper Series from CESifo

Abstract: This paper re-examines the relationship between trade intensity and business cycle synchronization for 21 OECD countries during 1970-2003. Instead of using instrumental variables, we estimate a multivariate model including variables capturing specialisation, financial integration, and similarity of economic policies. We confirm that trade intensity affects business cycle synchronization, but the effect is much smaller than previously reported. Other factors in our model have a similar impact on business cycle synchronization as trade intensity. Finally, we find that the effect of trade on business cycle synchronisation is not driven by outliers and does not suffer from parameter heterogeneity.

Keywords: business cycles; trade; synchronization of business cycles (search for similar items in EconPapers)
JEL-codes: E32 F42 (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-cwa, nep-int and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (51)

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Related works:
Journal Article: Trade and business cycle synchronization in OECD countries--A re-examination (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1546

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