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New evidence on the (de)synchronisation of business cycles: Reshaping the European business cycle

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  • Veaceslav Grigoras
  • Irina Eusignia Stanciu

Abstract

Business cycle synchronisation (or the lack thereof) has fallen once again under the spotlight of policy and academic circles. In the spirit of Burns and Mitchell and the NBER, this paper dates turning points for most European countries and the US. Later on, synchronisation is addressed through a series of measures, studying the clustering of turning points, along with indicators of concordance and correlation. Last but not least, the main properties of cycles are analysed, in order to provide a more comprehensive view on business cycle similarities. We conclude that previous to the Great Recession the European business cycle has been constantly enforced by formal or informal cohesion between EU member states. However, post-crisis developments show signs of a great disconnect, both within Europe and between Europe and the US. Moreover, heterogeneity of business cycle measures hints at a possible overstating of business cycle synchronisation within the EU.

Suggested Citation

  • Veaceslav Grigoras & Irina Eusignia Stanciu, 2016. "New evidence on the (de)synchronisation of business cycles: Reshaping the European business cycle," International Economics, CEPII research center, issue 147, pages 27-52.
    • Handle: RePEc:cii:cepiie:2016-q3-147-2
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    2. Uctum Merih & Uctum Remzi & Vijverberg Chu-Ping C., 2021. "The European growth synchronization through crises and structural changes," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 25(1), pages 1-17, February.
    3. Luboš Hanus & Lukáš Vácha, 2020. "Growth cycle synchronization of the Visegrad Four and the European Union," Empirical Economics, Springer, vol. 58(4), pages 1779-1795, April.
    4. Gießler Stefan & Heinisch Katja & Holtemöller Oliver, 2021. "(Since When) Are East and West German Business Cycles Synchronised?," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 241(1), pages 1-28, February.
    5. Ansgar Belke & Clemens Domnick & Daniel Gros, 2017. "Business Cycle Synchronization in the EMU: Core vs. Periphery," Open Economies Review, Springer, vol. 28(5), pages 863-892, November.
    6. Kovačić, Zlatko & Vilotić, Miloš, 2017. "Assessing European business cycles synchronization," MPRA Paper 79990, University Library of Munich, Germany.
    7. Beck, Krzysztof, 2021. "Why business cycles diverge? Structural evidence from the European Union," Journal of Economic Dynamics and Control, Elsevier, vol. 133(C).
    8. Ngozi E. Egbuna & Maimuna John-Sowe & Santigie M. Kargbo (PhD) & Sani Bawa (PhD) & Ibrahima Diallo & Isatou Mendy, 2020. "Business Cycle Synchronisation In The Ecowas Region," Working Papers 18, West African Monetary Institute.
    9. Bogdan Munteanu, 2017. "Unconventional Monetary Policy: Changing European Central Bank’S Perspective On Financial Governance," Europolity – Continuity and Change in European Governance - New Series, Department of International Relations and European Integration, National University of Political Studies and Public Administration, vol. 11(1), pages 1-32.
    10. Nestor Azcona, 2022. "Business Cycle Co-Movement in Europe: Trade, Industry Composition and the Single Currency," Open Economies Review, Springer, vol. 33(1), pages 121-139, February.
    11. Ľubica Štiblárová, 2020. "Traditional and Alternative Business Cycle Dating Procedures: Evidence for the Euro Area and the Czech Economy," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 68(1), pages 263-274.
    12. Krzysztof Beck, 2021. "Capital mobility and the synchronization of business cycles: Evidence from the European Union," Review of International Economics, Wiley Blackwell, vol. 29(4), pages 1065-1079, September.

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    More about this item

    Keywords

    Business cycle dating; Business cycles synchronisation; International business cycles;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles

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