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The Impact of Globalization on the U.S. Business Cycle: Technical Paper 1999-6

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  • Edward N. Gamber
  • Juann Hung

Abstract

This paper investigates whether the U.S. has become more globalized and if so whether that increased globalization has helped hold down inflation and prolong the current economic expansion. We find that U.S. globalization, which has been rising significantly over the past four decades, surged beyond its earlier trend in the 1990s. Import prices exert a greater impact on prices of products in industries faced with greater import penetration. High foreign excess capacity accounts for much of the recent decline in U.S. inflation. Finally, the degree of business cycle

Suggested Citation

  • Edward N. Gamber & Juann Hung, 1999. "The Impact of Globalization on the U.S. Business Cycle: Technical Paper 1999-6," Working Papers 13342, Congressional Budget Office.
    • Handle: RePEc:cbo:wpaper:13342
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    File URL: https://www.cbo.gov/sites/default/files/106th-congress-1999-2000/workingpaper/19996_1.pdf
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    1. Catherine L. Mann, 1997. "Globalization and Productivity in the United States and Germany," Working Paper Series Working Paper Special (1), Peterson Institute for International Economics.
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    4. Christina D. Romer & David H. Romer, 1989. "Does Monetary Policy Matter? A New Test in the Spirit of Friedman and Schwartz," NBER Chapters, in: NBER Macroeconomics Annual 1989, Volume 4, pages 121-184, National Bureau of Economic Research, Inc.
    5. James A. Orr, 1994. "Has excess capacity abroad reduced U.S. inflationary pressures?," Quarterly Review, Federal Reserve Bank of New York, vol. 19(Sum), pages 101-106.
    6. Mr. Phillip L Swagel & Mr. Matthew J. Slaughter, 1997. "The Effect of Globalization on Wages in the Advanced Economies," IMF Working Papers 1997/043, International Monetary Fund.
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