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Grupo de Estudos Monetários e Financeiros

Estudos do GEMF, N.º 21 de 2010


A Closer Look at the World Business Cycle Synchronization

(Publicado em International Economics and Economic Policy 10(3): 349-363, 2013)

Pedro André Cerqueira
GEMF / Faculdade de Economia, Universidade de Coimbra

This paper uses a transformation of the period-by-period index proposed by Cerqueira and Martins(2009), to overcome some of it shortcomings, in a non-parametric estimation to analyze how business cycle synchronization for a sample of 111 countries evolved in the period 1960-2007 . The period-by-period index is able to distinguish between negative correlations due to episodes in single years, asynchronous behavior in turbulent times and synchronous behavior over stable periods and the non-parametric approach provides a more detailed analysis than the use of a parametric approach. The results show that since the nineties the synchronization at the world level, within and between country groups, experienced a dramatic increase reaching the highest values ever at the sample end.

JEL Classification: C33, E32, F42.

Keywords: Globalization, Business cycle synchronization, Convergence.

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