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Trade integration and business cycle convergence: Is the relation robust across time and space?

Abbott, Andrew; Easaw, Joshy; Xing, Tao

Authors

Joshy Easaw

Tao Xing

Abstract

In this paper we investigate the relationship between trade intensity and the business cycle correlation using a panel data set taken from 24 countries over the period 1959-2003. Most previous studies did not account for the possibility that the business cycle correlation may be influenced by unobservable country-pair specific effects. Our estimates, using both fixed- and random-effects methodologies, suggest that trade intensity and the business cycle correlation are positively related to one another. However, detailed investigation shows that this relationship exists mainly for the European countries. © 2008 the editors of the Scandinavian Journal of Economics.

Journal Article Type Article
Publication Date Jul 21, 2008
Journal Scandinavian Journal Of Economics
Print ISSN 0347-0520
Electronic ISSN 1467-9442
Publisher Wiley
Peer Reviewed Peer Reviewed
Volume 110
Issue 2
Pages 403-417
DOI https://doi.org/10.1111/j.1467-9442.2008.00539.x
Keywords Economics and Econometrics
Publisher URL https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1467-9442.2008.00539.x