IDEAS home Printed from https://ideas.repec.org/p/cep/sercdp/0019.html
   My bibliography  Save this paper

The UK Intranational Trade Cycle

Author

Listed:
  • Michael Artis
  • Toshihiro Okubo

Abstract

The paper uses annual data on real GDP for the UK regions and 12 manufacturing sectors toderive regional and regional/sectoral business cycles using an H-P filter. The cohesion of thecycles is examined via cross-correlations and comparisons made with the regional cycles forJapan, the United States and the EuroArea. The UK emerges as especially cohesive andefforts to explain the overall cross-correlations of regional GDP are not very successfulowing to the low variance of the explicand; when attention is turned to the sectoral/regionalcycles, with their greater variance it is possible to demonstrate that economic variables suchas distance, dissimilarity in structure and level of output play a significant role in explainingthe variance in the cross-correlations. A significant feature of the cross-correlations inrelation to those of EU countries is that whilst they continue to provide support for the "UKidiosyncrasy" they no longer do so as strongly as they did in earlier data samples

Suggested Citation

  • Michael Artis & Toshihiro Okubo, 2009. "The UK Intranational Trade Cycle," SERC Discussion Papers 0019, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:sercdp:0019
    as

    Download full text from publisher

    File URL: http://cep.lse.ac.uk/pubs/download/sercdp0019.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Burnside, Craig, 1998. "Detrending and business cycle facts: A comment," Journal of Monetary Economics, Elsevier, vol. 41(3), pages 513-532, May.
    2. Pedroni, Peter & Yao, James Yudong, 2006. "Regional income divergence in China," Journal of Asian Economics, Elsevier, vol. 17(2), pages 294-315, April.
    3. Salvador Barrios & Marius Brülhart & Robert J.R. Elliott & Marianne Sensier, 2003. "A Tale of Two Cycles: Co‐Fluctuations Between UK Regions and the Euro Zone," Manchester School, University of Manchester, vol. 71(3), pages 265-292, June.
    4. repec:bla:econom:v:67:y:2000:i:267:p:347-74 is not listed on IDEAS
    5. Artis, Michael & Okubo, Toshihiro, 2008. "The Intranational Business Cycle: Evidence from Japan," CEPR Discussion Papers 6686, C.E.P.R. Discussion Papers.
    6. Canova, Fabio, 1998. "Detrending and business cycle facts: A user's guide," Journal of Monetary Economics, Elsevier, vol. 41(3), pages 533-540, May.
    7. Uhlig, H.F.H.V.S. & Ravn, M., 1997. "On Adjusting the H-P Filter for the Frequency of Observations," Discussion Paper 1997-50, Tilburg University, Center for Economic Research.
    8. Bernard, Andrew B. & Durlauf, Steven N., 1996. "Interpreting tests of the convergence hypothesis," Journal of Econometrics, Elsevier, vol. 71(1-2), pages 161-173.
    9. Canova, Fabio, 1998. "Detrending and business cycle facts," Journal of Monetary Economics, Elsevier, vol. 41(3), pages 475-512, May.
    10. Michael Artis, 2002. "Dating the Business Cycle in Britain," National Institute Economic Review, National Institute of Economic and Social Research, vol. 182(1), pages 90-95, October.
    11. Hodrick, Robert J & Prescott, Edward C, 1997. "Postwar U.S. Business Cycles: An Empirical Investigation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 29(1), pages 1-16, February.
    12. Hess, Gregory D. & Shin, Kwanho, 1998. "Intranational business cycles in the United States," Journal of International Economics, Elsevier, vol. 44(2), pages 289-313, April.
    13. Harvey, A C & Jaeger, A, 1993. "Detrending, Stylized Facts and the Business Cycle," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 8(3), pages 231-247, July-Sept.
    14. Mario Forni & Lucrezia Reichlin, 1998. "Let's Get Real: A Factor Analytical Approach to Disaggregated Business Cycle Dynamics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 65(3), pages 453-473.
    15. Regina Kaiser & Agustín Maravall, 2002. "A Complete Model-Based Interpretation of the Hodrick-Prescott Filter: Spuriousness Reconsidered," Working Papers 0208, Banco de España.
    16. William C. Gruben & Jahyeong Koo & Eric Millis, 2002. "How much does international trade affect business cycle synchronization ?," Working Papers 0203, Federal Reserve Bank of Dallas.
    17. Hess, Gregory D & Shin, Kwanho, 1997. "International and Intranational Business Cycles," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 13(3), pages 93-109, Autumn.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Huang, Shuo & Fidrmuc, Jan & Fidrmuc, Jarko, 2015. "Whither China? Reform and economic integration among Chinese regions," China Economic Review, Elsevier, vol. 33(C), pages 94-110.
    2. Jürgen Bierbaumer, 2012. "Regionale Konjunkturzyklen in Österreich," WIFO Monatsberichte (monthly reports), WIFO, vol. 85(11), pages 833-848, November.
    3. Artis, Michael & Okubo, Toshihiro, 2009. "Globalization and business cycle transmission," The North American Journal of Economics and Finance, Elsevier, vol. 20(2), pages 91-99, August.
    4. Juergen Bierbaumer-Polly, 2012. "Regional and Sectoral Business Cycles - Key Features for the Austrian economy," EcoMod2012 4074, EcoMod.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Michael Artis & Toshihiro Okubo, 2010. "The UK intranational business cycle," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 29(1-2), pages 71-93.
    2. Artis, Michael & Okubo, Toshihiro, 2008. "The Intranational Business Cycle: Evidence from Japan," CEPR Discussion Papers 6686, C.E.P.R. Discussion Papers.
    3. Michael Artis & Toshihiro Okubo, 2011. "The intranational business cycle in Japan," Oxford Economic Papers, Oxford University Press, vol. 63(1), pages 111-133, January.
    4. Artis, Michael & Okubo, Toshihiro, 2009. "Globalization and business cycle transmission," The North American Journal of Economics and Finance, Elsevier, vol. 20(2), pages 91-99, August.
    5. Juergen Bierbaumer-Polly, 2012. "Regional and Sectoral Business Cycles - Key Features for the Austrian economy," EcoMod2012 4074, EcoMod.
    6. Aadland, David, 2005. "Detrending time-aggregated data," Economics Letters, Elsevier, vol. 89(3), pages 287-293, December.
    7. Andrikopoulos, Andreas & Loizides, Ioannis & Prodromidis, Kyprianos, 2004. "Fiscal policy and political business cycles in the EU," European Journal of Political Economy, Elsevier, vol. 20(1), pages 125-152, March.
    8. Michael J. Artis & Toshihiro Okubo, 2012. "Business Cycle, Currency And Trade, Revisited," Pacific Economic Review, Wiley Blackwell, vol. 17(1), pages 160-180, February.
    9. Fritz, Marlon, 2019. "Steady state adjusting trends using a data-driven local polynomial regression," Economic Modelling, Elsevier, vol. 83(C), pages 312-325.
    10. Özer Karagedikli & Troy Matheson & Christie Smith & Shaun P. Vahey, 2010. "RBCs AND DSGEs: THE COMPUTATIONAL APPROACH TO BUSINESS CYCLE THEORY AND EVIDENCE," Journal of Economic Surveys, Wiley Blackwell, vol. 24(1), pages 113-136, February.
    11. Rand, John & Tarp, Finn, 2002. "Business Cycles in Developing Countries: Are They Different?," World Development, Elsevier, vol. 30(12), pages 2071-2088, December.
    12. Mertens, Elmar, 2010. "Structural shocks and the comovements between output and interest rates," Journal of Economic Dynamics and Control, Elsevier, vol. 34(6), pages 1171-1186, June.
    13. Celsa Machado, 2001. "Measuring Business Cycles: The Real Business Cycle Approach and Related Controversies," FEP Working Papers 107, Universidade do Porto, Faculdade de Economia do Porto.
    14. Maravall, A. & del Rio, A., 2007. "Temporal aggregation, systematic sampling, and the Hodrick-Prescott filter," Computational Statistics & Data Analysis, Elsevier, vol. 52(2), pages 975-998, October.
    15. Klaus Reiner Schenk-Hopp�, "undated". "Economic Growth and Business Cycles: A Critical Comment on Detrending Time Series (Revised Version)," IEW - Working Papers 054, Institute for Empirical Research in Economics - University of Zurich.
    16. Yongsung Chang & Sunoong Hwang, 2015. "Asymmetric Phase Shifts in U.S. Industrial Production Cycles," The Review of Economics and Statistics, MIT Press, vol. 97(1), pages 116-133, March.
    17. Zsolt Darvas & György Szapáry, 2008. "Business Cycle Synchronization in the Enlarged EU," Open Economies Review, Springer, vol. 19(1), pages 1-19, February.
    18. Mellár, Tamás & Németh, Kristóf, 2018. "A kibocsátási rés becslése többváltozós állapottérmodellekben. Szuperhiszterézis és további empirikus eredmények [Estimating output gap in multivariate state space models. Super-hysteresis and furt," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(6), pages 557-591.
    19. L.A. Gil-Alana, 2005. "Fractional Cyclical Structures & Business Cycles in the Specification of the US Real Output," European Research Studies Journal, European Research Studies Journal, vol. 0(1-2), pages 99-126.
    20. MAO TAKONGMO, Charles Olivier, 2019. "Keynesian Models, Detrending, and the Method of Moments," MPRA Paper 91709, University Library of Munich, Germany.

    More about this item

    Keywords

    intranational business cycle; regional business cycles; income convergence; Hodrick-Prescott filter; Euro-sympathy;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:cep:sercdp:0019. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: the person in charge (email available below). General contact details of provider: https://cep.lse.ac.uk/_new/publications/serc-papers/ .

    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.