Business Cycles, International Trade and Capital Flows: Evidence from Latin America

37 Pages Posted: 21 Nov 2012

See all articles by Guglielmo Maria Caporale

Guglielmo Maria Caporale

Brunel University London - Department of Economics and Finance; London South Bank University; CESifo (Center for Economic Studies and Ifo Institute); German Institute for Economic Research (DIW Berlin)

Alessandro Girardi

National Institute of Statistics (ISTAT)

Multiple version iconThere are 2 versions of this paper

Date Written: November 1, 2012

Abstract

This paper adopts a flexible framework to assess both short- and long-run business cycle linkages between six Latin American (LA) countries and the four largest economies in the world (namely the US, the Euro area, Japan and China) over the period 1980:I-2011:IV. The result indicate that within the LA region there are considerable differences between countries, success stories coexisting with extremely vulnerable economies. They also show that the LA region as a whole is largely dependent on external developments, especially in the years after the great recession of 2008 and 2009. The trade channel appears to be the most important source of business cycle co-movement, whilst capital flows are found to have a limited role, especially in the very short run.

Keywords: International business cycle, Latin America, VAR models, trade and financial linkages

JEL Classification: C32, E32, F31, F41

Suggested Citation

Caporale, Guglielmo Maria and Girardi, Alessandro, Business Cycles, International Trade and Capital Flows: Evidence from Latin America (November 1, 2012). DIW Berlin Discussion Paper No. 1254, Available at SSRN: https://ssrn.com/abstract=2178445 or http://dx.doi.org/10.2139/ssrn.2178445

Guglielmo Maria Caporale (Contact Author)

Brunel University London - Department of Economics and Finance ( email )

Kingston Lane
Marie Jahoda Building
Uxbridge, Middlesex UB8 3PH
United Kingdom
+44 1895 266713 (Phone)
+44 1895 269770 (Fax)

HOME PAGE: http://www.brunel.ac.uk/about/acad/bbs/bbsstaff/ef_staff/guglielmocaporale/

London South Bank University ( email )

Centre for Monetary and Financial Economics
London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstra├če 58
Berlin, 10117
Germany

Alessandro Girardi

National Institute of Statistics (ISTAT) ( email )

Via Cesare Balbo 16
00184 Rome, 0185
Italy

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
31
Abstract Views
440
PlumX Metrics