The Propagation of Regional Recessions
AbstractThis paper develops a framework for inferring common Markov-switching components in a panel data set with large cross-section and time-series dimensions. We apply the framework to studying similarities and differences across U.S. states in the timing of business cycles. We hypothesize that there exists a small number of cluster designations, with individual states in a given cluster sharing certain business cycle characteristics. We find that although oil-producing and agricultural states can sometimes experience a separate recession from the rest of the United States, for the most part, differences across states appear to be a matter of timing, with some states entering recession or recovering before others.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 16657.
Date of creation: Jan 2011
Date of revision:
Publication status: published as James D. Hamilton & Michael T. Owyang, 2012. "The Propagation of Regional Recessions," The Review of Economics and Statistics, MIT Press, vol. 94(4), pages 935-947, November.
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Web page: http://www.nber.org
More information through EDIRC
Other versions of this item:
- E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-01-16 (All new papers)
- NEP-BEC-2011-01-16 (Business Economics)
- NEP-CBA-2011-01-16 (Central Banking)
- NEP-GEO-2011-01-16 (Economic Geography)
- NEP-MAC-2011-01-16 (Macroeconomics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gerald Carlino & Robert Defina, 1998. "The Differential Regional Effects Of Monetary Policy," The Review of Economics and Statistics, MIT Press, vol. 80(4), pages 572-587, November.
- van Dijk, A. & Franses, Ph.H.B.F. & Paap, R. & van Dijk, D.J.C., 2007.
"Modeling regional house prices,"
Econometric Institute Research Papers
EI 2007-55, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
- Sylvia Kaufmann, 2008.
"Dating and forecasting turning points by Bayesian clustering with dynamic structure: A suggestion with an application to Austrian data,"
144, Oesterreichische Nationalbank (Austrian Central Bank).
- Sylvia Kaufmann, 2010. "Dating and forecasting turning points by Bayesian clustering with dynamic structure: a suggestion with an application to Austrian data," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 25(2), pages 309-344.
- Owyang, Michael T. & Piger, Jeremy M. & Wall, Howard J. & Wheeler, Christopher H., 2008.
"The economic performance of cities: A Markov-switching approach,"
Journal of Urban Economics,
Elsevier, vol. 64(3), pages 538-550, November.
- Michael T. Owyang & Jeremy M. Piger & Howard J. Wall & Christopher H. Wheeler, 2007. "The economic performance of cities: a Markov-switching approach," Working Papers 2006-056, Federal Reserve Bank of St. Louis.
- Gerald Carlino & Keith Sill, 2000.
"Regional income fluctuations: common trends and common cycles,"
00-8, Federal Reserve Bank of Philadelphia.
- Gerald Carlino & Keith Sill, 2001. "Regional Income Fluctuations: Common Trends And Common Cycles," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 446-456, August.
- Geweke, John & Keane, Michael, 2007. "Smoothly mixing regressions," Journal of Econometrics, Elsevier, vol. 138(1), pages 252-290, May.
- Mario Forni & Lucrezia Reichlin, 2001.
"Federal policies and local economies: Europe and the U.S,"
ULB Institutional Repository
2013/10141, ULB -- Universite Libre de Bruxelles.
- Forni, Mario & Reichlin, Lucrezia, 2001. "Federal policies and local economies: Europe and the US," European Economic Review, Elsevier, vol. 45(1), pages 109-134, January.
- Del Negro, Marco, 2002.
"Asymmetric shocks among U.S. states,"
Journal of International Economics,
Elsevier, vol. 56(2), pages 273-297, March.
- Hamilton, James D, 1989. "A New Approach to the Economic Analysis of Nonstationary Time Series and the Business Cycle," Econometrica, Econometric Society, vol. 57(2), pages 357-84, March.
- Carlino, Gerald A. & DeFina, Robert H., 2004. "How strong is co-movement in employment over the business cycle? Evidence from state/sector data," Journal of Urban Economics, Elsevier, vol. 55(2), pages 298-315, March.
- Mark D. Partridge & Dan S. Rickman, 2005. "Regional cyclical asymmetries in an optimal currency area: an analysis using US state data," Oxford Economic Papers, Oxford University Press, vol. 57(3), pages 373-397, July.
- Michael T. Owyang & Jeremy Piger & Howard J. Wall, 2005.
"Business Cycle Phases in U.S. States,"
The Review of Economics and Statistics,
MIT Press, vol. 87(4), pages 604-616, November.
- Arthur F. Burns & Wesley C. Mitchell, 1946. "Measuring Business Cycles," NBER Books, National Bureau of Economic Research, Inc, number burn46-1.
- Christopher A. Sims & Daniel F. Waggoner & Tao Zha, 2006.
"Methods for inference in large multiple-equation Markov-switching models,"
2006-22, Federal Reserve Bank of Atlanta.
- Sims, Christopher A. & Waggoner, Daniel F. & Zha, Tao, 2008. "Methods for inference in large multiple-equation Markov-switching models," Journal of Econometrics, Elsevier, vol. 146(2), pages 255-274, October.
- Frühwirth-Schnatter, Sylvia & Kaufmann, Sylvia, 2004.
"Model-based Clustering of Multiple Time Series,"
CEPR Discussion Papers
4650, C.E.P.R. Discussion Papers.
- Michael A. Kouparitsas, 1999. "Is the United States an optimal currency area?," Chicago Fed Letter, Federal Reserve Bank of Chicago, issue Oct.
- Chib, Siddhartha, 1996. "Calculating posterior distributions and modal estimates in Markov mixture models," Journal of Econometrics, Elsevier, vol. 75(1), pages 79-97, November.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.