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Cycles inside cycles: Spanish regional aggregation

  • Ana Gomez Loscos

    ()

  • M. Dolores Gadea
  • Antonio Montañes

This paper sets out a comprehensive framework to identify regional business cycles within Spain and analyses their stylised features and the degree of synchronization present among them and the Spanish economy. We show that the regional cycles are quite heterogeneous although they display some degree of synchronization that can be partially explained using macroeconomic variables. We also propose a dynamic factor model to cluster the regional comovements and Önd out if the country cycle is simply the aggregation of the regional ones. We Önd that the Spanish business cycle is not shared by the seventeen regions, but is the sum of the di§erent regional behaviours. The implications derived from our results are useful both for policy makers and analysts.

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Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa11p99.

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Date of creation: Sep 2011
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Handle: RePEc:wiw:wiwrsa:ersa11p99
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