International Business Cycle Accounting
Keisuke Otsu ()
Studies in Economics from School of Economics, University of Kent
In this paper, I extend the business cycle accounting method a la Chari, Kehoe and McGrattan (2007) to a two-country international business cycle model and quantify the effect of the disturbances in relevant markets on the business cycle correlation between Japan and the US over the 1980-2008 period. I find that disturbances in the labor market and production efficiency are important in accounting for the recent increase in the cross-country output correlation. Financial globalization can be the cause of the recent increase in cross-country output correlation if it operated through an increase in the cross- country correlation of disturbances in the labour market and production efficiency, not in the domestic or international capital markets.
Keywords: Business Cycle Accounting; International Business Cycles; Financial Globalization (search for similar items in EconPapers)
JEL-codes: E32 F41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dge, nep-mac and nep-opm
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Working Paper: International Business Cycle Accounting (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:ukc:ukcedp:1010
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