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dc.contributor.authorAgnello, L-
dc.contributor.authorCaporale, GM-
dc.contributor.authorSousa, R-
dc.identifier.citationBulletin of Economic Research, (2016)en_US
dc.description.abstractUsing quarterly data for a panel of advanced economies, we show that synchronized fiscal consolidation (stimulus) programmes in different countries make their business cycles more closely linked. We also find: (i) some evidence of decoupling when an inflation targeting regime is unilaterally adopted; (ii) an increase in business cycle synchronization when countries fix their exchange rates and become members of a monetary union; (iii) a positive effect of bilateral trade on the synchronization of business cycles. Global factors, such as a rise in global risk aversion and uncertainty and a reversal of nonstandard expansionary monetary policy, can also reduce the degree of co-movement of business cycles across countries. From a policy perspective, our work shows that an inflation targeting regime coupled with simultaneous fiscal consolidations can lead to more business cycle synchronization.en_US
dc.subjectFiscal consolidationen_US
dc.subjectFiscal stimulusen_US
dc.subjectBusiness cycle synchronizationen_US
dc.subjectJEL classification numbersen_US
dc.titleHow Do Fiscal Consolidation and Fiscal Stimuli Impact On The Synchronization of Business Cycles?en_US
dc.relation.isPartOfBulletin of Economic Research-
Appears in Collections:Dept of Economics and Finance Research Papers

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