IDEAS home Printed from https://ideas.repec.org/p/cre/crefwp/37.html
   My bibliography  Save this paper

International Trade over the Business Cycle: Stylized Facts and Remaining Puzzles

Author

Abstract

Using quarterly national accounts for 19 industrialized economies, the business cycle behavior of trade related aggregates and prices is assessed. Emphasis is put on the distinction between small, relatively open, and large, relatively closed, economies. Comparing those facts with the computational experiments of international real business cycle models, several puzzles are studied or uncovered. Finally, we determine which fatcs are crucial for international business cycle models, that is, in which direction current research should pursue. Nous étudions, pour 19 pays industrialisés, le comportement cyclique d'agrégats et de prix trimestriels liés au commerce international. La distinction entre les petits pays, plus ouverts, et les grands pays, relativement fermés au commerce extérieur, est mise en évidence. En comparant ces faits stylisés avec les prédictions de modèles internationaux du cycle réel, nous analysons plusieurs énigmes, dont certaines sont nouvelles. Finalement, nous déterminons quels faits stylisés sont cruciaux pour un modèle international du cycle, donc dans quelle direction la recherche doit s'orienter.

Suggested Citation

  • Christian Zimmermann, 1995. "International Trade over the Business Cycle: Stylized Facts and Remaining Puzzles," Cahiers de recherche CREFE / CREFE Working Papers 37, CREFE, Université du Québec à Montréal, revised Aug 1997.
  • Handle: RePEc:cre:crefwp:37
    as

    Download full text from publisher

    File URL: http://www.unites.uqam.ca/eco/CREFE/cahiers/cah37r.ps
    File Function: Main text (revision, including tables)
    Download Restriction: no

    File URL: http://www.unites.uqam.ca/eco/CREFE/cahiers/cah37r.pdf
    File Function: Main text (revision, including tables)
    Download Restriction: no

    File URL: http://www.unites.uqam.ca/eco/CREFE/cahiers/cah37tb.ps
    File Function: Tables
    Download Restriction: no

    File URL: http://www.unites.uqam.ca/eco/CREFE/cahiers/cah37tc.ps
    File Function: Supplementary tables
    Download Restriction: no

    File URL: http://www.unites.uqam.ca/eco/CREFE/cahiers/cah37.pdf
    File Function: Main text
    Download Restriction: no

    File URL: http://www.unites.uqam.ca/eco/CREFE/cahiers/cah37tb.pdf
    File Function: Tables
    Download Restriction: no

    File URL: http://www.unites.uqam.ca/eco/CREFE/cahiers/cah37tc.pdf
    File Function: Supplementary tables
    Download Restriction: no

    References listed on IDEAS

    as
    1. Tesar, Linda L., 1991. "Savings, investment and international capital flows," Journal of International Economics, Elsevier, vol. 31(1-2), pages 55-78, August.
    2. Backus, David K & Kehoe, Patrick J & Kydland, Finn E, 1994. "Dynamics of the Trade Balance and the Terms of Trade: The J-Curve?," American Economic Review, American Economic Association, vol. 84(1), pages 84-103, March.
    3. Danthine, Jean-Pierre & Girardin, Michel, 1989. "Business cycles in Switzerland : A comparative study," European Economic Review, Elsevier, vol. 33(1), pages 31-50, January.
    4. Baxter, Marianne & Crucini, Mario J, 1995. "Business Cycles and the Asset Structure of Foreign Trade," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 36(4), pages 821-854, November.
    5. Backus, David K & Kehoe, Patrick J & Kydland, Finn E, 1992. "International Real Business Cycles," Journal of Political Economy, University of Chicago Press, vol. 100(4), pages 745-775, August.
    6. David Backus & Patrick Kehoe & Finn Kydland, 1992. "Dynamics of the trade balance and the terms of trade: the J-curve revisited," Discussion Paper / Institute for Empirical Macroeconomics 65, Federal Reserve Bank of Minneapolis.
    7. Zimmermann, Christian, 1999. "International Business Cycles and Exchange Rates," Review of International Economics, Wiley Blackwell, vol. 7(4), pages 682-698, November.
    8. Baxter, Marianne & Crucini, Mario J, 1993. "Explaining Saving-Investment Correlations," American Economic Review, American Economic Association, vol. 83(3), pages 416-436, June.
    9. Meltzer, Allan H., 1986. "Size, persistence and interrelation of nominal and real shocks : Some evidence from four countries," Journal of Monetary Economics, Elsevier, vol. 17(1), pages 161-194, January.
    10. Cooley, Thomas F. & Ohanian, Lee E., 1991. "The cyclical behavior of prices," Journal of Monetary Economics, Elsevier, vol. 28(1), pages 25-60, August.
    11. Zimmermann, Christian, 1997. "International real business cycles among heterogeneous countries," European Economic Review, Elsevier, vol. 41(2), pages 319-356, February.
    12. Stockman, Alan C & Tesar, Linda L, 1995. "Tastes and Technology in a Two-Country Model of the Business Cycle: Explaining International Comovements," American Economic Review, American Economic Association, vol. 85(1), pages 168-185, March.
    13. Hodrick, Robert J & Prescott, Edward C, 1997. "Postwar U.S. Business Cycles: An Empirical Investigation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 29(1), pages 1-16, February.
    14. Obstfeld, Maurice, 1986. "Capital mobility in the world economy: Theory and measurement," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 24(1), pages 55-103, January.
    15. Kydland, Finn E & Prescott, Edward C, 1982. "Time to Build and Aggregate Fluctuations," Econometrica, Econometric Society, vol. 50(6), pages 1345-1370, November.
    16. Marianne Baxter & Alan C. Stockman, 1988. "Business Cycles and the Exchange Rate System: Some International Evidence," NBER Working Papers 2689, National Bureau of Economic Research, Inc.
    17. Baxter, Marianne & Stockman, Alan C., 1989. "Business cycles and the exchange-rate regime : Some international evidence," Journal of Monetary Economics, Elsevier, vol. 23(3), pages 377-400, May.
    18. Allen C. Head, 1995. "Country Size, Aggregate Fluctuations, and International Risk Sharing," Canadian Journal of Economics, Canadian Economics Association, vol. 28(4b), pages 1096-1119, November.
    19. Blackburn, Keith & Ravn, Morten O, 1992. "Business Cycles in the United Kingdom: Facts and Fictions," Economica, London School of Economics and Political Science, vol. 59(236), pages 383-401, November.
    20. Peter Brandner & Klaus Neusser, 1992. "Business cycles in open economies: Stylized facts for Austria and Germany," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 128(1), pages 67-87, March.
    21. Murphy, Robert G., 1984. "Capital mobility and the relationship between saving and investment rates in OECD countries," Journal of International Money and Finance, Elsevier, vol. 3(3), pages 327-342, December.
    22. Feldstein, Martin & Horioka, Charles, 1980. "Domestic Saving and International Capital Flows," Economic Journal, Royal Economic Society, vol. 90(358), pages 314-329, June.
    23. David Backus & Patrick J. Kehoe & Finn E. Kydland, 1993. "International Business Cycles: Theory and Evidence," NBER Working Papers 4493, National Bureau of Economic Research, Inc.
    24. Crucini, Mario J, 1997. "Country Size and Economic Fluctuations," Review of International Economics, Wiley Blackwell, vol. 5(2), pages 204-220, May.
    25. Fiorito, Riccardo & Kollintzas, Tryphon, 1994. "Stylized facts of business cycles in the G7 from a real business cycles perspective," European Economic Review, Elsevier, vol. 38(2), pages 235-269, February.
    26. Gertler, Mark & Rogoff, Kenneth, 1990. "North-South lending and endogenous domestic capital market inefficiencies," Journal of Monetary Economics, Elsevier, vol. 26(2), pages 245-266, October.
    27. Finn E. Kydland & Edward C. Prescott, 1990. "Business cycles: real facts and a monetary myth," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Spr, pages 3-18.
    28. Christian Zimmermann, 1994. "Technology Innovations and the Volatility of Output: An International Perspective," Cahiers de recherche CREFE / CREFE Working Papers 34, CREFE, Université du Québec à Montréal.
    29. Finn, Mary G., 1990. "On savings and investment dynamics in a small open economy," Journal of International Economics, Elsevier, vol. 29(1-2), pages 1-21, August.
    30. Long, John B, Jr & Plosser, Charles I, 1983. "Real Business Cycles," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 39-69, February.
    31. Lucas, Robert E., 1977. "Understanding business cycles," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 5(1), pages 7-29, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ambler, Steve & Cardia, Emanuela, 1995. "Les modèles réels de la transmission internationale du cycle économique," L'Actualité Economique, Société Canadienne de Science Economique, vol. 71(2), pages 193-217, juin.
    2. Zimmermann, Christian, 1997. "International real business cycles among heterogeneous countries," European Economic Review, Elsevier, vol. 41(2), pages 319-356, February.
    3. Pacheco Jiménez, J.F., 2001. "Business cycles in small open economies: the case of Costa Rica," ISS Working Papers - General Series 19075, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    4. Almuth Scholl, 2002. "Limited Enforceable International Loans, International Risk Sharing and Trade," SFB 649 Discussion Papers SFB649DP2005-055, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany, revised Aug 2005.
    5. Blankenau, William & Kose, M. Ayhan, 2007. "How Different Is The Cyclical Behavior Of Home Production Across Countries?," Macroeconomic Dynamics, Cambridge University Press, vol. 11(01), pages 56-78, February.
    6. Michael Gail, 1998. "Stylized Facts and International Business Cycles - The German Case," Volkswirtschaftliche Diskussionsbeiträge 69-98, Universität Siegen, Fakultät Wirtschaftswissenschaften, Wirtschaftsinformatik und Wirtschaftsrecht, revised 2000.
    7. Eva Ortega, "undated". "The Spanish business cycle and its relationship to Europe," Studies on the Spanish Economy 09, FEDEA.
    8. Afonso, António & Furceri, Davide, 2010. "Government size, composition, volatility and economic growth," European Journal of Political Economy, Elsevier, vol. 26(4), pages 517-532, December.
    9. Christian Zimmermann, 2001. "Forecasting with Real Business Cycle Models," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 36(1), pages 189-203, January.
    10. Ambler, Steve & Cardia, Emanuela & Zimmermann, Christian, 2002. "International transmission of the business cycle in a multi-sector model," European Economic Review, Elsevier, vol. 46(2), pages 273-300, February.
    11. Cook, David, 2002. "Market entry and international propagation of business cycles," Journal of International Economics, Elsevier, vol. 56(1), pages 155-175, January.

    More about this item

    Keywords

    open economy macroeconomics; international trade; business cycles; small countries;

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

    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:cre:crefwp:37. 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: (Stéphane Pallage). General contact details of provider: http://edirc.repec.org/data/crefeca.html .

    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.