IDEAS home Printed from https://ideas.repec.org/a/ris/integr/0810.html
   My bibliography  Save this article

Trade Integration and Business Cycle Synchronization in Latin American Countries

Author

Listed:
  • Kim, Young Ji

    (Sungkyunkwan University, Republic of Korea)

  • Kim, Sunghyun

    (Sungkyunkwan University, Republic of Korea)

Abstract

This paper investigates the relationship between business cycle synchronization and trade integration in the Latin American region. Using data for 17 Latin American countries and the United States (US) from 1980 to 2018, we document the time-series characteristics of business cycle synchronization and intraand inter-regional trade in the region and empirically test whether trade integration contributed to business cycle synchronization. The data demonstrate that the business cycle synchronization index has been steadily increasing in the region. Regional trade integration increased until the financial crisis in 2008 and decreased slightly thereafter. The results of a system generalized method of moments (GMM) regression indicate that bilateral trade with the US significantly increased business cycle synchronization in the region, except during the 2000s, while regional trade had no significant effect. These results emphasize the importance of the indirect trade channel, especially with the US, as a main channel of business cycle synchronization in Latin America.

Suggested Citation

  • Kim, Young Ji & Kim, Sunghyun, 2020. "Trade Integration and Business Cycle Synchronization in Latin American Countries," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 35(4), pages 559-575.
    • Handle: RePEc:ris:integr:0810
    as

    Download full text from publisher

    File URL: https://www.e-jei.org
    File Function: Full text
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Business cycle synchronization; external trade linkages; indirect trade channel; regional integration; Latin America;
    All these keywords.

    JEL classification:

    • F30 - International Economics - - International Finance - - - General
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:integr:0810. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Yunhoe Kim (email available below). General contact details of provider: https://edirc.repec.org/data/desejkr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.