Integration and Fluctuations: The Case of MENA

Posted: 18 Oct 2005

See all articles by Hideaki Hirata

Hideaki Hirata

Hosei University; Japan Center for Economic Research

Sunghyun Henry Kim

Sungkyunkwan University - Department of Economics

M. Ayhan Kose

World Bank; Brookings Institution; Centre for Economic Policy Research (CEPR); Australian National University (ANU)

Abstract

This paper analyzes the impact of global integration on the dynamics of economic growth and business cycles in the emerging economies of Middle East and North Africa (MENA) and Asia. In particular, the paper examines the evolution of structural characteristics, growth dynamics, and business cycle properties of these countries during the 1960-2000 period. Although both groups of countries became more open and were able to diversify their industrial structures and export bases over time, the MENA countries lagged behind the Asian economies in both trade integration and the extent of diversification of exports during the globalization period (1986-2000). Although economic growth slowed in both groups during the period of globalization, the extent of the slowdown was much sharper in the MENA countries. Moreover, business cycle fluctuations in the MENA countries were much more volatile than in the Asian economies. In addition, although both groups of countries witnessed a moderation in the amplitude of macroeconomic fluctuations during the globalization period, the decline in the volatility of cyclical fluctuations in the MENA countries was relatively small, partially because of the inability of these countries to utilize the benefits of global integration.

Keywords: Business cycles, globalization, macroeconomic fluctuations, MENA

JEL Classification: E32, F22

Suggested Citation

Hirata, Hideaki and Kim, Sunghyun Henry and Kose, M. Ayhan, Integration and Fluctuations: The Case of MENA. Emerging Markets Finance and Trade, Vol. 40, No. 6, pp. 48-67, November-December 2004, Available at SSRN: https://ssrn.com/abstract=820885

Hideaki Hirata (Contact Author)

Hosei University ( email )

2-17-1 Fujimi
Chiyoda, Tokyo 112-6601
Japan

Japan Center for Economic Research ( email )

2-6-1, Nihonbashi Kayabacho
Chuo-ku, Tokyo 103-0025
Japan

Sunghyun Henry Kim

Sungkyunkwan University - Department of Economics ( email )

110-745 Seoul
Korea

M. Ayhan Kose

World Bank

1818 H Street, NW
Washington, DC 20433
United States

Brookings Institution

1775 Massachusetts Ave, NW
Washington, DC 20036
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Australian National University (ANU)

Canberra, Australian Capital Territory 2601
Australia

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