Institutions and Business Cycles

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract This paper investigates the relationship between the main business cycles features and the institutional and structural characteristics of countries in which they are observed. Using the nonparametric Harding-Pagan approach, we derive the business cycle characteristics of a set of 63 countries that includes industrial, emerging and formerly centrally planned economies from all continents. Our analysis reveals that institutional factors have significant associations with the main business cycle characteristics. In addition, we examine the determinants of business cycle synchronization for the countries in our sample. In contrast to earlier studies which seek to account for such synchronization using gravity arguments as well as trade intensity and bilateral financial linkages only, we also consider the proximity of their institutional and policy environments. Terms of use: Documents inKeywords: Institutions, business cycles, synchronization, nonparametric analysis JEL Codes: C32, E32, E37 * We are grateful to SumruÖz for her comments on an earlier version of this paper and to Erhan Uluceviz for his help with some of the data used in this study.

Income distribution and economic crises

“…36 The significant effect is observed for GDP per capita of above $5,000 (lGDPpc_B>8.5). 37 Altug, Emin, and Neyapti (2012) argue that business cycle characteristics of developing and emerging economies are largely variable. 38 The significance of length and GINI_B remains robust when the sample is restricted to that of TopBot10_A.…”

“…Altug, Emin, and Neyapti () argue that business cycle characteristics of developing and emerging economies are largely variable.…”

Business cycle synchronization in the CIS region

“…In their examination of 62 countries of various income levels, Altug et al. (2012) find that the transition and CIS countries have severe contractions in their business cycles similar to those of the Latin American countries. Unlike the Latin American region, however, these countries have longer business cycle expansions.…”

Has the Euro-Mediterranean Partnership Affected Mediterranean Business Cycles?

“…Altug et al . () have studied this relationship for a large cross‐section of countries and found that institutions matter more than standard macroeconomic factors for business cycle fluctuations. Their analysis, however, includes only a few Mediterranean countries and they happen to have similar institutions.…”