IDEAS home Printed from https://ideas.repec.org/a/ebl/ecbull/eb-06e30002.html
   My bibliography  Save this article

Trading Business-Cycle Depth for Duration using an economy-specific characteristic

Author

Listed:
  • Ossama Mikhail

    () (Dept. of Economics - College of Business Administration - University of Central Florida)

Abstract

Regarding the trade-off between the depth and the duration of recessions, there exists a mounting empirical evidence of the idiosyncratic and non-synchronized behavior of the business cycle over time within and across countries. To account for the trade-off, a model is presented wherein an economy-specific parameter does control the magnitude, severity and persistence of the business cycle without the need to add an asymmetric functional form [that captures the propagation mechanism] to the model. The model results show that as much as half of a percentage point of GDP in depth and a relative difference of three years duration can be attributed to this parameter. The model implies a two-dimensional depth-duration space wherein we place the [average] depth-duration expansion and contraction for the U.S.

Suggested Citation

  • Ossama Mikhail, 2006. "Trading Business-Cycle Depth for Duration using an economy-specific characteristic," Economics Bulletin, AccessEcon, vol. 5(7), pages 1-12.
  • Handle: RePEc:ebl:ecbull:eb-06e30002
    as

    Download full text from publisher

    File URL: http://www.accessecon.com/pubs/EB/2006/Volume5/EB-06E30002A.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Edwards, Sebastian & Biscarri, Javier Gomez & Perez de Gracia, Fernando, 2003. "Stock market cycles, financial liberalization and volatility," Journal of International Money and Finance, Elsevier, vol. 22(7), pages 925-955, December.
    2. Kydland, Finn E & Prescott, Edward C, 1982. "Time to Build and Aggregate Fluctuations," Econometrica, Econometric Society, vol. 50(6), pages 1345-1370, November.
    3. D van Dijk & D R Osborn & M Sensier, 2002. "Changes in variability of the business cycle in the G7 countries," The School of Economics Discussion Paper Series 0204, Economics, The University of Manchester.
    4. Olivier Blanchard & John Simon, 2001. "The Long and Large Decline in U.S. Output Volatility," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 32(1), pages 135-174.
    5. Terence C. Mills & Ping Wang, 2002. "Plucking models of business cycle fluctuations: Evidence from the G-7 countries," Empirical Economics, Springer, vol. 27(2), pages 255-276.
    6. Margaret M. McConnell & Gabriel Perez-Quiros, 2000. "Output fluctuations in the United States: what has changed since the early 1980s?," Proceedings, Federal Reserve Bank of San Francisco, issue Mar.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Business Cycles Depth;

    JEL classification:

    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-06e30002. See general 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: (John P. Conley). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.