This paper reexamines the relationship between trade integration and business cycle synchronization (BCS) using new value-added trade data for 63 advanced and emerging economies during 1995–2012. In a panel framework, we identify a strong positive impact of trade intensity on BCS - conditional...

This paper is an extension of "Why are the Beveridge-Nelson and Unobserved-Components Decompositions of GDP so Different?" (Morley, Nelson, and Zivot, 2003) to Clark's double-drift unobserved components model. We show that the reduced-form of the double-drift model is an ARIMA(2,2,3) model, and...

This paper reexamines the relationship between trade integration and business cycle synchronization (BCS) using new value-added trade data for 63 advanced and emerging economies during 1995–2012. In a panel framework, we identify a strong positive impact of trade intensity on BCS—conditional...