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Mexico and the United States: cycle synchronization,1980.1-2013.4

Author

Listed:
  • Eduardo Loría

    () (Center for Modeling and Economic Forecasting, School of Economics, Universidad Nacional Autónoma de México (UNAM). México, D.F.)

  • Emmanuel Salas

    () (Center for Modeling and Economic Forecasting, School of Economics, Universidad Nacional Autónoma de México (UNAM). México, D.F.)

Abstract

We estimated the progressive, structural synchronization of the Mexican growth cycle with that of the US (total and industrial) for 1980.1-2013.4. By applying the Quandt-Andrews (1993) and Bai-Perron (2003) unknown-breakpoint tests, we identified that before 1994.4 there was no statistically significant relationship between the Mexican GDP growth cycle and the US industrial output cycle, but a weak (statistically significant) relationship with total US GDP cycle. However, since 1997.4 and particularly since 2001.2, there is a vast and increasing synchronization and determination from the US industrial cycle to the Mexican cycle (R2 = 0.96). The degrees of freedom of Mexican domestic economic policy have thus drastically decreased.

Suggested Citation

  • Eduardo Loría & Emmanuel Salas, 2015. "Mexico and the United States: cycle synchronization,1980.1-2013.4," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(1), pages 75-102, May.
  • Handle: RePEc:ere:journl:v:xxxiv:y:2015:i:1:p:75-102
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Mexico-US growth cycles; synchronization; end-of-sample correction; unknown-breakpoint tests.;
    All these keywords.

    JEL classification:

    • C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models
    • F15 - International Economics - - Trade - - - Economic Integration
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts

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