[eng] The capital asset pricing model for consumption cannot explain observed equity premiums unless disproportionate risk aversion coefficients are used. The equity premium puzzle has been attributed in particular to the time-separability of consumer preferences. This paper investigates...

Drawing on a large cross-section of countries, this paper explores whether closer economic ties between countries foster business cycle synchronisation and disentangles the role of the various channels, including trade and financial linkages as well as the similarity in sectoral specialisation....