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Regional business cycles in New Zealand: Do they exist? What might drive them?

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  • Viv B. Hall
  • C. John McDermott

Abstract

. We establish classical business cycles, for New Zealand's 14 regions and aggregate national activity. Regional cycles rarely die of old age but are terminated by particular events. Concordance statistic measures show significant contemporaneous associations between the New Zealand cycle and 11 of the regional cycles. Over half the bi‐regional co‐movements are not significant. Geographical proximity influences co‐movement between regions, as do unusually dry climatic conditions. Neither real national house price movements, nor net migration movements co‐move significantly with regional cycle phases. For key regions, movements in New Zealand's terms of trade, milksolids’ prices, dairy land prices and total rural land prices are significant. Rural business cycle activity has therefore remained a remarkably dominant factor. Abstract. Establecemos ciclos clásicos de empresas, para 14 regiones de Nueva Zelanda y actividad nacional agregada. Los ciclos regionales raramente mueren con el tiempo sino que terminan con eventos específicos. Las medidas estadísticas de concordancia muestran asociaciones contemporáneas significativas entre el ciclo de Nueva Zelanda y 11 de los ciclos regionales. Más de la mitad de los co‐movimientos bi‐regionales no son significativos. La proximidad geográfica influye en el co‐movimiento entre regiones, al igual que las condiciones climáticas inusualmente secas. Ni los movimientos de precios de vivienda nacionales reales, ni los movimientos netos migratorios, muestran un co‐movimiento significativo con las fases de ciclos regionales. Para regiones clave, los movimientos en términos neozelandeses de comercio, precios de sólidos lácteos, precios de tierras para explotaciones lecheras, y total de precios de tierras de labor son significativos. La actividad del ciclo de empresas rurales ha permanecido por tanto como un factor dominante.

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  • Viv B. Hall & C. John McDermott, 2007. "Regional business cycles in New Zealand: Do they exist? What might drive them?," Papers in Regional Science, Wiley Blackwell, vol. 86(2), pages 167-191, June.
    • Handle: RePEc:bla:presci:v:86:y:2007:i:2:p:167-191
    DOI: 10.1111/j.1435-5957.2007.00119.x
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    More about this item

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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