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Does the Number of Countries in an International Business Cycle Model Matter?

Kim, Myunghyun - 2019

Until the 1990s, standard models with two large open economies (i.e. the U.S. and Europe) provided plausible representations of the world economy. However, with the emergence of many countries such as China since then, this approach no longer seems reasonable. In line with this change to the...

Persistent link: https://www.econbiz.de/10012872329

Can Indeterminacy and Self-Fulfilling Expectations Help Explain International Business Cycles? A Preliminary Investigation

McKnight, Stephen - 2016

indeterminacy model can also resolve the Backus-Smith puzzle without requiring a low value of the trade elasticity …

Persistent link: https://www.econbiz.de/10013004783

Financial Frictions and the International Transmission of Shocks

Park, Woong Yong - 2019

This study presents a two-good, two-country model with financial frictions, where banks facing a borrowing constraint intermediate funds between households and firms. The endogenous fluctuations of international relative prices increase the business cycle co-movement across countries when...

Persistent link: https://www.econbiz.de/10012858531

Taxes and International Risk Sharing

Epstein, Brendan - 2014

We examine the extent to which differences in international tax rates may account for the small correlations of per capita consumption fluctuations across countries. Theory implies a close relationship between relative consumption growth, and consumption and capital income tax rate...

Persistent link: https://www.econbiz.de/10013049823

International Spillovers of Output Growth and Output Growth Volatility : Evidence from the G7 Countries

Antonakakis, Nikolaos - 2014

This paper examines the transmission of GDP growth and GDP growth volatility among the G7 countries over the period 1960Q1 – 2010Q4, using a multivariate GARCH model and volatility impulse response functions (VIRFs) to identify the source, magnitude and the duration of volatility spillovers....

Persistent link: https://www.econbiz.de/10013058576

The East African Monetary Union : Is the Level of Business Cycle Synchronization Sufficient?

Miles, William - 2015

The East African Community (Burundi, Kenya, Rwanda, Tanzania and Uganda) has a goal of a currency union, as part of a movement toward eventual political union. A key factor in making a currency union desirable is a high level of business cycle synchronization (BCS) among member countries. In...

Persistent link: https://www.econbiz.de/10013021726

How Do Credit Supply Shocks Propagate Internationally? A Gvar Approach

Eickmeier, Sandra - 2016

period 1983-2009. We experiment with inter-country links that distinguish bilateral trade, portfolio investment, foreign … bilateral trade and inward foreign direct investment or outward banking claim exposures in a GVAR fits the data better than … using trade weights only. We use sign restrictions on the short-run impulse responses to financial shocks that have the …

Persistent link: https://www.econbiz.de/10012991020

Global Banking, Trade, and the International Transmission of the Great Recession

Born, Alexandra - 2018

large parts of the world. In this paper we explore the financial and the trade channel in a unified framework and quantify … losses in the value of cross-border asset holdings. Calibrated to German data, the model predicts the trade channel to be …. The transmission via the financial channel triggers a much longer-lasting recession relative to the trade channel …

Persistent link: https://www.econbiz.de/10012920861

International Co-Movements in Recessions

Roth, Moritz A. - 2018

Business cycle correlations are state-dependent and higher in recessions than in expansions. In this paper, I suggest a mechanism to explain why this is the case. For this purpose, I build an international real business cycle model with occasionally binding constraints on capacity utilization...

Persistent link: https://www.econbiz.de/10012928657

Common Trade Exposure and Business Cycle Comovement

Avila-Montealegre, Oscar; Mix, Carter - 2021

A large empirical literature has shown that countries that trade more with each other have more correlated business … cycles. We show that previous estimates of this relationship are biased upward because they ignore common trade exposure to … other countries. When we account for common trade exposure to foreign business cycles, we find that (1) the effect of …

Persistent link: https://www.econbiz.de/10013231944