spectral analysis of causality relationship between production and international trade cycles in the selected economic blocks

in the era of globalization, particularly, since early 1990s, economies around the world have been affected considerably by co-movements in one or more countries. in the literature this phenomenon is recognized as synchronization in business cycles, while joint policies being conducted by trading partners can modify such effects properly. the objective of this paper has been to evaluate a possible synchronized relationship between gdp and international trade cycles in the selected countries in different economic blocks consisting of developed, emerging, oil- exporting and non-oil exporting countries. the causality between these cycles has been analyzed spectrally during 1970-2013 in low and high frequencies. the results obtained show the existence of causation from trade cycles towards gdp cycles in all blocks. hence, trade relations have caused production cycles, implying the more degree of trade expansion the more synchronization intensity in the business cycles. jel classification: e32, f20, f44.