Publication date

दिस्, 2022

Details

Applied Economics (ABDC, A and ABS, 2)

Authors

Aakanksha Shrawan & Amlendu Dubey

Abstract

Recent contributions to the business cycle literature point towards the presence of potential nonlinearities in the relationship between similarities in sectoral composition of countries and their bilateral business cycle synchronization. By using a dynamic indicator of structural change (as opposed to the traditional static indicators), this article attempts to identify whether the similarities in the evolution of structural change across countries influence their bilateral business cycle synchronization heterogeneously across quantiles. With focus on India and its advanced and developing trade partners, this article employs the quantile regression model with non-additive fixed effects to assess this relationship. While India and its advanced countries' trade partners display a homogeneous and positive relationship between the similarity in evolution of agriculture and industry and their bilateral business cycle synchronization, there exists a homogeneously negative relationship with respect to the service sector. Similarities in the evolution of the industry and the service sector between India and its developing trade partners, on the other hand, have a heterogeneous impact on their bilateral business cycle synchronization.

https://doi.org/10.1080/00036846.2022.2141461