This paper proposes a Markov-switching framework to endogenously identify periods where economies are more likely to:(i) synchronously enter recessionary and expansionary phases, and (ii) follow independent business cycles. The reliability of the framework is validated with simulated data in...

The U.S. aggregate business cycle is often characterized as a series of distinct recession and expansion phases. We apply a regime-switching model to state-level coincident indexes and conclude that state business cycles also can be characterized in this way. We find also that states differ a...