Regional business cycle synchronization in emerging and developing countries: Regional or global integration? Trade or financial integration?

Abstract

This paper examines the effects of regional versus global integration and trade versus financial integration on regional business cycle synchronization in three regions containing developing and emerging countries (East Asia, Latin America, and Central and Eastern Europe). The main empirical results are as follows: (1) strong and similar common global linkages, especially financial linkages, have significant positive effects on the synchronization of regional business cycles; (2) after controlling global linkages, regional trade integration has a positive effect on regional business cycle synchronization, whereas regional financial integration has a negative effect; and (3) although the direction for the effect of each type of integration is similar across regions, the relative importance of each in explaining regional business cycle synchronization is different. Specifically, while global financial linkages play the most important role in East Asia and Latin America, regional trade integration is most important in Central and Eastern Europe.

Determinantes de la sincronización de los ciclos económicos en América del Norte

“…La literatura que analiza los determinantes de la sincronización de los ciclos económicos se caracteriza por centrar su atención en grupos de economías desarrolladas. Sin embargo, los estudios de Calderón et al (2007), Chang (2011), Gong y Kim (2018) se caracterizan por analizar dicha relación entre economías con diferentes niveles de desarrollo económico. Los resultados de estos estudios muestran que, aunque existe una relación positiva del comercio en la sincronización, su relevancia tiende a ser menor cuando se estudian economías en vías de desarrollo.…”

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Cyclicity In Russian Regional Economy Sectors: Models And Results

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