American Economic Review Vol. 108 No. 1 2018

The Micro Origins of International Business-Cycle Comovement

Julian di Giovanni¹; Andrei A. Levchenko²; Isabelle Mejean³

¹ ICREA-Universitat Pompeu Fabra, Barcelona GSE, Ramon Trias Fargas 25–27, 08005, Barcelona, Spain, CREI, and CEPR (email: ) · ² University of Michigan, 611 Tappan Street, Ann Arbor, MI 48109, NBER, and CEPR (email: ) · ³ CREST, École Polytechnique, Université Paris-Saclay, Route de Saclay 91128 Palaiseau Cedex, France, and CEPR (email: )

Abstract

This paper investigates the role of individual firms in international business-cycle comovement using data covering the universe of French firm-level value added and international linkages over the period 1993–2007. At the micro level, trade and multinational linkages with a particular foreign country are associated with a significantly higher correlation between a firm and that foreign country. The impact of direct linkages on comovement at the micro level has significant macro implications. Without those linkages the correlation between France and foreign countries would fall by about 0.098, or one-third of the observed average correlation of 0.291 in our sample of partner countries.

DOI

10.1257/aer.20160091

Volume

108

Issue

1

Pages

82-108

Language

en

Sources

bibtex:phds-export.bib openalex crossref

Cite

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