International Business Cycle Synchronization: A Synthetic Assessment

Publication | August 2022
This paper presents findings from a study that synthetically assessed the three major transmission channels of international business cycles: trade, foreign direct investment (FDI), and portfolio flows between economies with multiple fixed effects.

Results showed that real and financial integration generates heterogeneous impacts on business cycle comovement. Trade integration and greenfield FDI lead business cycle comovements, likely due to deepening intra-industry trade and dense global value chains. Higher debt market integration is associated with more synchronized business cycle comovement, while equity integration leads to business cycle divergence.

Contents 

  • Introduction
  • Literature Review
  • Data and Empirical Specification
  • Estimation Results
  • Conclusion

Additional Details

Authors
Type
Series
Subjects
  • Economics
  • Industry and trade
Pages
  • 28
Dimensions
  • 8.5 x 11
SKU
  • WPS220355-2
ISSN
  • 2313-6537 (print)
  • 2313-6545 (electronic)

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