Convergence of the Economic Sentiment Cycles in the Eurozone: A Time‐Frequency Analysis

22 Pages Posted: 28 Mar 2013

Date Written: May 2013

Abstract

In this article, wavelet tools and economic sentiment indicators are used to study the similarity and synchronization of economic cycles in the eurozone. The time‐varying and frequency‐varying patterns of business cycles synchronization are assessed and the impact of the creation of the European monetary union (EMU) in 1999 is tested. Among several results, it is found that: the EMU is associated with a significant increase in the similarity and synchronization of the economic sentiment in the eurozone; and the hard‐peg of its currency to the euro led to a comparable effect on Denmark's economic sentiment after 1999, different from what happened in the United Kingdom.

Suggested Citation

Aguiar‐Conraria, Luís and Martins, Manuel V. and Soares, Maria Joana, Convergence of the Economic Sentiment Cycles in the Eurozone: A Time‐Frequency Analysis (May 2013). JCMS: Journal of Common Market Studies, Vol. 51, Issue 3, pp. 377-398, 2013, Available at SSRN: https://ssrn.com/abstract=2240800 or http://dx.doi.org/10.1111/j.1468-5965.2012.02315.x

Luís Aguiar‐Conraria (Contact Author)

University of Minho

No Address Available

Manuel V. Martins

Universidade do Porto ( email )

Maria Joana Soares

University of Minho

No Address Available

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