The Synchronization of Business Cycles among Iran’s Trade Partners

Authors: not saved
Abstract:

In recent years, investigating synchronization of business cycles among countries, after increasing integration of global economies, has been attracted more attention of policy makers and researchers. Perhaps an unknown origin of such similarities, as an open question, is the main reason of these interests. So, with regard to the mentioned question, the aim of this paper is to investigate some probably determinants of synchronization among Iran’s main trade partners. Therefore, in the first step, in order to measure business cycles, some parametric and non-parametric techniques are used. Then, applying several criteria, the degree of synchronization is determined. After these two steps, employing IV-GLS and QR estimators, the relationship between business cycles and trade intensity index, as a possible channel of synchronization, has considered. The result shows that an increase in trade intensity index increases   business cycle synchronization for all 21 sample countries. Also, this result remained almost unchanged when we divided sample into some subsamples. It is worthy to note that due to the endogeneity of independent variable, the gravity equation and Helpman theorem(1981) are employed. In these equations, some variables such as GDP, common borders and distance had significant effects on trade intensity and hence on business cycles

Upgrade to premium to download articles

Sign up to access the full text

Already have an account?login

similar resources

Investigating the Factors Affecting Trade within the Pharmaceutical Industry in Iran and Selection of Business Partners (with Emphasis on Innovation)

Given the fluctuations in world oil prices and the endless supply of this underground resource, the pharmaceutical industry is one of the attractive sectors of investment in intra-industry trade. Intra-industry trade refers to the simultaneous export and import of a group of similar goods, resulting in product differentiation in imperfectly competitive markets and the existence of economies of ...

full text

Business Cycle Synchronization and Patterns of Trade: Cases from Gulf Cooperation Council Countries

 Do similarities in trade patterns of GCC countries (UAE, KSA, Qatar, Bahrain, Kuwait, and Oman), which are geographically and politically alike and also enjoy oil income, affect the synchronization of their business cycles and make them have similar booms and busts? In this paper, we attempt to connect these two features and explore this question. Using various estimation methods (Common Corre...

full text

Effects of Business Cycles on Bilateral Trade Flows in Eurozone Countries

In economic theory, various determinants are considered to explore their effects on trade patterns. Accordingly, business cycles indicate turbulences in economic activities. Business cycles and their fluctuations cause a change in demand for goods and services from the other country then it can affect trade flows. In this study, by using a gravity model, we study the effects of business cycles ...

full text

How Does Globalization Affect the Synchronization of Business Cycles?

The phenomenon of globalization, which refers to the rising trade and Ž nancial integration of the world economy, has gathered steam in recent decades. The growth rate of world trade has been greater than that of world output in almost all years since 1960, and the cumulative increase in the volume of world trade is almost three times larger than that of world output over this period. A more dr...

full text

Trade, Production Sharing and the International Transmission of Business Cycles

This paper is motivated by three observations about the link between international trade and international business cycle synchronization: (1) a large increase in trade in manufactures over the last 30 years, (2) a larger fraction of trade between core and periphery regions relative to core regions is in the form of production sharing, (3) crosscountry output correlations have increased between...

full text

My Resources

Save resource for easier access later

Save to my library Already added to my library

{@ msg_add @}


Journal title

volume 2  issue 1

pages  49- 71

publication date 2013-06-21

By following a journal you will be notified via email when a new issue of this journal is published.

Hosted on Doprax cloud platform doprax.com

copyright © 2015-2023