Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/50568
Authors: 
Otsu, Keisuke
Year of Publication: 
2010
Series/Report no.: 
School of Economics discussion papers 10,10
Abstract: 
In this paper, I extend the business cycle accounting method a la Chari, Kehoe and McGrattan (2007) to a two-country international business cycle model and quantify the effect of the disturbances in relevant markets on the business cycle correlation between Japan and the US over the 1980-2008 period. I find that disturbances in the labor market and production efficiency are important in accounting for the recent increase in the cross-country output correlation. Financial globalization can be the cause of the recent increase in cross-country output correlation if it operated through an increase in the cross-country correlation of disturbances in the labor market and production efficiency, not in the domestic or international capital markets.
Subjects: 
business cycle accounting
international business cycles
financial globalization
JEL: 
E32
F41
Document Type: 
Working Paper

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