← Search

American Economic Review Vol. 93 No. 4 2003

International Business Cycles: World, Region, and Country-Specific Factors

M. Ayhan Kose1; Christopher Otrok2; Charles H. Whiteman3

1 International Monetary Fund, 700 19th Street, NW, Washington, DC 20431. · 2 Department of Economics, 114 Rouss Hall, University of Virginia, Charlottesville, VA 22903. · 3 Department of Economics, W380 John Pappajohn Business Building, University of Iowa, Iowa City, IA 52242.

Abstract

The paper investigates the common dynamic properties of business-cycle fluctuations across countries, regions, and the world. We employ a Bayesian dynamic latent factor model to estimate common components in macroeconomic aggregates (output, consumption, and investment) in a 60-country sample covering seven regions of the world. The results indicate that a common world factor is an important source of volatility for aggregates in most countries, providing evidence for a world business cycle. We find that region-specific factors play only a minor role in explaining fluctuations in economic activity. We also document similarities and differences across regions, countries, and aggregates.

DOI
10.1257/000282803769206278
Volume
93
Issue
4
Pages
1216-1239
Language
en
Sources
crossref openalex bibtex:phds-export.bib

Cite