International Evidence on the Determinants of Trade Dynamics

43 Pages Posted: 15 Feb 2006  

Eswar S. Prasad

Cornell University - Dyson School of Applied Economics and Management; Cornell University - Department of Economics; Brookings Institution; NBER; IZA Institute of Labor Economics

Jeffery Gable

affiliation not provided to SSRN

Date Written: December 1997

Abstract

This paper provides some new empirical perspectives on the relationship between international trade and macroeconomic fluctuations in industrial economies. First, a comprehensive set of stylized facts concerning fluctuations in trade variables and their determinants are presented. A measure of the quantitative importance of international trade for the propagation of domestic business cycles is then constructed, focusing on the role of external trade as a catalyst for cyclical recoveries. Finally, structural vector autoregression models are used to characterize the joint dynamics of output, exchange rates, and trade variables in response to different types of macroeconomic shocks.

Keywords: Trade balance, business cycles, exchange rates, OECD industrial economies

JEL Classification: F32, F41

Suggested Citation

Prasad, Eswar S. and Gable, Jeffery, International Evidence on the Determinants of Trade Dynamics (December 1997). IMF Working Paper, Vol. , pp. 1-43, 1997. Available at SSRN: https://ssrn.com/abstract=883297

Eswar S. Prasad (Contact Author)

Cornell University - Dyson School of Applied Economics and Management ( email )

440 Warren Hall
Ithaca, NY 14853
United States

HOME PAGE: http://prasad.aem.cornell.edu

Cornell University - Department of Economics ( email )

414 Uris Hall
Ithaca, NY 14853-7601
United States

Brookings Institution ( email )

1775 Massachusetts Ave, NW
Washington, DC 20036
United States

NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Jeffery Gable

affiliation not provided to SSRN

No Address Available

Paper statistics

Downloads
76
Rank
254,415
Abstract Views
449