Does foreign direct investment synchronise business cycles? : results from a panel approach


Fries, Claudia ; Kappler, Marcus


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URL: https://ub-madoc.bib.uni-mannheim.de/39343
URN: urn:nbn:de:bsz:180-madoc-393437
Document Type: Working paper
Year of publication: 2015
The title of a journal, publication series: ZEW Discussion Papers
Volume: 15-031
Place of publication: Mannheim
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: F21 , F41 , F44 , F49,
Keywords (English): Business cycle synchronisation , FDI , trade , sectoral differences , panel
Abstract: This study readdresses the determinants of business cycle synchronisation. We test, on the one hand, whether FDI promoting policies may have consequences for the business cycle comovement between countries, and on the other hand, whether more plausi- ble identification strategies change previous results. Our results suggest that linkages through foreign direct investment contribute in most cases positively to the synchroni- sation between country pairs. In contrast, the beneficial effects of trade integration for the similarity of business cycles are less robust and thus less important for the trans- mission of idiosyncratic shocks between countries than previously thought. Finally, we find that larger differences in the sector structure between two economies result in a bigger gap between their business cycles.

Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.




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Fries, Claudia ; Kappler, Marcus (2015) Does foreign direct investment synchronise business cycles? : results from a panel approach. Open Access ZEW Discussion Papers Mannheim 15-031 [Working paper]
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