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Gains from Synchronization

Author

Listed:
  • William Barnett

    (Department of Economics, The University of Kansas)

  • Mehmet Dalkir

    (Department of Economics, The University of Kansas)

Abstract

This paper investigates the transmission mechanisms of noise and volatility between economies through trade links, and the effects of synchronization on business cycles. We investigate the transmission of outside noise and the fluctuations that the noise generates. We identify conditions under which international economic links reduce the economic output noise emanating from noise within the individual economies. Under certain conditions, devaluation of a country's currency causes reduction in the business cycle noise and volatility as seen by that country's exporters, while increased valuation of a country's currency produces higher noise and volatility, as seen by the country's importers.

Suggested Citation

  • William Barnett & Mehmet Dalkir, 2005. "Gains from Synchronization," WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS 200511, University of Kansas, Department of Economics, revised Apr 2005.
    • Handle: RePEc:kan:wpaper:200511
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    File URL: http://www.ku.edu/~bgju/2005Papers/200511.pdf
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    References listed on IDEAS

    as
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    2. Alain Raybaut, 2018. "Coupling and synchronization dynamics in endogenous business cycles models," Post-Print halshs-01941339, HAL.

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    Keywords

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    JEL classification:

    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • D9 - Microeconomics - - Micro-Based Behavioral Economics
    • E - Macroeconomics and Monetary Economics

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