Common Shoks, Common Dynamics and the International Business Cycle

A.W. Hecq, G. Cubadda

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11 Citations (Scopus)

Abstract

This paper proposes an econometric framework to assess the importance of common shocks and common transmission mechanisms in generating international business cycles. Then we show how to decompose the cyclical effects of permanent–transitory shocks into those due to their domestic and those due to foreign components. Our empirical analysis reveals that the business cycles of the us, japan, canada are clearly dominated by their domestic components. The euro area is more sensitive to foreign shocks compared to the other three countries of our analysis.
Original languageEnglish
Pages (from-to)149-166
JournalEconomic Modelling
Volume24
Issue number1
DOIs
Publication statusPublished - 1 Jan 2007

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