What Drives Regional Business Cycles? The Role of Common and Spatial Components
10 Pages Posted: 27 Aug 2011
Date Written: September 2011
Abstract
We examine real business cycle convergence for 41 euro area regions and 48 US states. The results obtained by a panel model with spatial effects indicate that the impact of national business cycles has been rather stable over the past two decades. A tendency for convergence in business cycles often detected in country data is not confirmed at the regional level. The pattern of synchronization across the euro area is similar to that across US states. Although cyclical heterogeneity is detected, it does not indicate a serious impediment to a common monetary policy of the European Central Bank.
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
What Drives Regional Business Cycles? The Role of Common and Spatial Components
This is a Wiley-Blackwell Publishing paper. Wiley-Blackwell Publishing charges $42.00 .
File name: j-9957.pdf
Size: 161K
If you wish to purchase the right to make copies of this paper for distribution to others, please select the quantity.
