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Asymmetric Phase Shifts in the U.S. Industrial Production Cycles

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  • Yongsung Chang

    ()
    (University of Rochester)

  • Sunoong Hwang

    ()
    (Korea Institute for Industrial Economics & Trade)

Abstract

We identify the cyclical turning points of 74 U.S. manufacturing industries and uncover new empirical regularities: (i) Cyclical phase shifts are highly concentrated around the aggregate turning points; (ii) In contrast to the conventional notion of a sudden stop and slow recovery, troughs are much more concentrated than peaks; (iii) Occurrences of phase shifts across industries support the spillovers through input-output linkages; (iv) The common macroeconomic shocks, such as exogenous changes in the federal funds rate, government spending, and oil prices, are significant drivers of industrial phase shifts; (v) Both monetary and fiscal policy shocks are more effective in recessions.

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File URL: http://rcer.econ.rochester.edu/RCERPAPERS/rcer_564.pdf
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Bibliographic Info

Paper provided by University of Rochester - Center for Economic Research (RCER) in its series RCER Working Papers with number 564.

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Length: 44 pages
Date of creation: Jul 2011
Date of revision:
Handle: RePEc:roc:rocher:564

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Postal: University of Rochester, Center for Economic Research, Department of Economics, Harkness 231 Rochester, New York 14627 U.S.A.

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Keywords: Business cycles; Comovement; Turning points; Asymmetries;

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Cited by:
  1. Sumru Altug & Fabio Canova, 2012. "Do Institutions and Culture Matter for Business Cycles?," Koç University-TUSIAD Economic Research Forum Working Papers 1217, Koc University-TUSIAD Economic Research Forum.

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