Desynchronized: The Comovement of Non-Hydrocarbon Business Cycles in the GCC

December 1, 2011

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Format: Chicago

Serhan Cevik. Desynchronized: The Comovement of Non-Hydrocarbon Business Cycles in the GCC, (USA: International Monetary Fund, 2011) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper investigates the empirical characteristics of business cycles and the extent of cyclical comovement in the Gulf Cooperation Council (GCC) countries, using various measures of synchronization for non-hydrocarbon GDP and constituents of aggregate demand during the period 1990-2010. By applying the Christiano-Fitzgerald asymmetric band-pass filter and a mean corrected concordance index, the paper identifies the degree of non-hydrocarbon business cycle synchronization?one of the main prerequisites for countries considering to establish a monetary union. The empirical results show low and heterogeneous synchronization in non-hydrocarbon business cycles across the GCC economies, and a decline in the degree of synchronicity in the 2000s, if Kuwait is excluded from the sample, partly because of divergent fiscal policies.

Subject: Business cycles, Economic growth, Economic integration, Expenditure, Government consumption, Monetary unions, National accounts, Private consumption, Public investment spending

Keywords: Aggregate demand, Asia and Pacific, Band-pass filter, Business cycle analysis, Business cycle desynchronization, Business cycle synchronization, Business cycles, Concordance, GCC country, GCC economy, Global, Government consumption, Monetary unions, Non-hydrocarbon business cycle frequency, Pairwise correlation coefficients, Private consumption, Public investment spending, WP

Publication Details

Pages:

25
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2011/286
Stock No:

WPIEA2011286
ISBN:

9781463927202
ISSN:

1018-5941

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