scholarly journals Are economic growth and the variability of the business cycle related? Evidence from five European countries

2008 ◽  
Vol 22 (4) ◽  
pp. 445-459 ◽  
Author(s):  
Stilianos Fountas ◽  
Menelaos Karanasos
Keyword(s):  
Economic Growth ◽  
Business Cycle ◽  
European Countries ◽  
The Business Cycle

Government spending shocks and economic growth: additional evidence from cyclical behavior of fiscal policy

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Olumide Olusegun Olaoye ◽  
Ukafor Ukafor Okorie ◽  
Oluwatosin Odunayo Eluwole ◽  
Mahmood Butt Fawwad
Keyword(s):  
Economic Growth ◽  
Business Cycle ◽  
Government Spending ◽  
Generalized Method Of Moments ◽  
The State ◽  
Fiscal Policies ◽  
Asymmetric Effect ◽  
Content Type ◽  
Spending Shocks ◽  
The Business Cycle

PurposeThis study examines the asymmetric effect of government spending on economic growth in Nigeria over the period 1980–2017. Specifically, this study investigates whether the response of economic growth to government spending shocks differs according to the nature of shocks on them. In addition, the authors examine whether the stabilizing effects of fiscal policies are dependent on the state of the business cycle.Design/methodology/approachThe study adopts the linear fiscal reaction function in addition to the nonlinear regression model of Hatemi-J (2011, 2012), Granger and Yoon (2002), which allows us to separate negative shocks from positive shocks to government spending. Similarly, the authors adopt the generalized method of moments (GMM) techniques of Hansen (1982) to account for simultaneity and endogeneity problems inherent in dynamic model.FindingsThe authors’ findings reveal that there is evidence of asymmetry in the government spending–economic growth nexus in Nigeria over the period of study. Specifically, the authors find that the response of economic growth to government spending shocks differs according to the nature of shocks on them. More specifically, the study established that the stabilizing effects of fiscal policies are dependent on the state of the business cycle.Originality/valueUnlike the traditional method of modeling asymmetry, which adopts the simple inclusion of a squared government spending term or by the inclusion of a cubic government spending term, the model adopted in this study allows us to model shocks and show how the responses of economic growth to government expenditure differ according to the nature of shocks on them.

Introduction

2021 ◽  
pp. 1-6
Author(s):  
Jesper Rangvid
Keyword(s):  
Economic Growth ◽  
Business Cycle ◽  
Stock Returns ◽  
Economic Activity ◽  
Final Part ◽  
Stylized Facts ◽  
Long Run ◽  
Key Concepts ◽  
The Business Cycle

Chapter 1 contains an overview of the book. Part I introduces key concepts, definitions, and stylized facts regarding long–run economic growth and stock returns.Part II analyses the relation between economic growth and stock returns in the long run. Part III examines the shorter-horizon relation between economic growth and stock returns: the relation over the business cycle. Part IV explains how to make reasonable projections for economic activity, both for the short and the long run. Part V deals with expected future stock returns. The final part, a short one including one chapter only, explains how one can use the insights from the book when making investments.

The Maquiladora Industry: Recent Downturn And Future Prospects

2011 ◽  
Vol 8 (3) ◽  
Author(s):  
Javad Gorjidooz ◽  
Bijan Vasigh
Keyword(s):  
United States ◽  
Economic Growth ◽  
Business Cycle ◽  
Labor Demand ◽  
The United States ◽  
Global Competition ◽  
Bracero Program ◽  
Major Player ◽  
The Business Cycle ◽  
The U.S

The Maquiladora industry was created in the mid-1960 as the United States terminated the Bracero program. The main objective of the Bracero program was to bring in Mexican workers to fulfill U.S. agricultural labor demand. The end of the Bracero program left thousands of unemployed farm workers in Mexican cities bordering the U.S. The Maquiladora programs intent was to subsidize foreign manufacturers that set up plants on the Mexico side of the border to create jobs for the Mexican workers. Mexico allowed plants to temporarily import supplies, parts, machinery, and equipment necessary to produce goods and services in Mexico duty-free as long as the output was exported back to the United States. U.S. firms, as well as other multinational companies, responded enthusiastically to the lure of cheap labor. Mexico experienced high economic growth and become a major player in exporting intra-industry products to the U.S. The NAFTA and other free trade agreements signed by Mexico helped the economic growth of the Maquiladora region. Maquiladora employment increased significantly since the inception of the Maquiladora industry and Maquiladora exports now account for half of Mexicos total exports. The Maquiladora industry is U.S.-demand driven since most of Mexicos Maquiladora production is destined for the U.S. market. The recent recession in the U.S. took a heavy toll on Mexicos Maquiladora industry. Another challenge to the Maquiladora industry is raising global competition, particularly from China. Therefore, the magnitude of the industrys contraction during the most recent recession suggests that there are more factors influencing the industry than just the business cycle. This paper presents the creation of the Maquiladora industry, its success following the NAFTA agreement, and its recent downturn. It also explores the answers to the following questions: How much of the Maquiladora downturn was due to the business cycle? How much was due to structural change? Is the Maquiladora industry ready to face rising global competition?

scholarly journals The Prediction of Business Cycle Phases: Financial Variables and International Linkages

2002 ◽  
Vol 182 ◽  
pp. 96-105 ◽  
Author(s):  
Denise R. Osborn ◽  
Marianne Sensier
Keyword(s):  
Stock Market ◽  
Business Cycle ◽  
European Countries ◽  
Financial Variables ◽  
The Third ◽  
The Us ◽  
International Linkages ◽  
The Business Cycle ◽  
The Uk

This paper discusses recent research at the Centre for Growth and Business Cycle Research on the prediction of the expansion and recession phases of the business cycle for the UK, US, Germany, France and Italy. Financial variables are important predictors in these models, with the stock market playing a key role in the US but not the European countries, including the UK. In contrast, international linkages are important for the European countries. Our models suggest that the US and German economies have now emerged from the recession of 2001, and that all five countries will be in expansion during the third quarter of this year.

Venezuela

2017 ◽  
Author(s):  
Guillermo Cruces ◽  
Gary S. Fields ◽  
David Jaume ◽  
Mariana Viollaz
Keyword(s):  
Economic Growth ◽  
Social Security ◽  
Business Cycle ◽  
Labour Market ◽  
Early Years ◽  
International Crisis ◽  
Occupational Position ◽  
The Business Cycle

Venezuela experienced slow economic growth during the 2000s. The economy suffered a recession in the early years of the period and during the international crisis of 2008, but most labour market indicators improved and moved along with the business cycle over the period. The chapter shows that the only indicators that did not improve were the composition of employment by occupational position and the percentage of workers registered with social security, which remained essentially unchanged. Most of the labour market indicators were affected negatively by the international crisis, and some of them had not recovered their pre-crisis levels by 2012.

scholarly journals Do COVID-19 Lock-Downs Affect Business Cycle? Analysis Using Energy Consumption Cycle Clock for Selected European Countries

Energies ◽  
2022 ◽  
Vol 15 (1) ◽  
pp. 340
Author(s):  
Tadeusz Kufel ◽  
Paweł Kufel ◽  
Marcin Błażejowski
Keyword(s):  
Energy Consumption ◽  
Business Cycle ◽  
Electricity Consumption ◽  
Economic Recession ◽  
European Countries ◽  
Pharmaceutical Drugs ◽  
Test Results ◽  
Global Pandemic ◽  
The Business Cycle ◽  
Pharmaceutical Interventions

On 11 March 2020, the WHO declared the COVID-19 epidemic to be a global pandemic. This was a consequence of the rapid increase in the number of people with positive test results, the increase in deaths due to COVID-19, and the lack of pharmaceutical drugs. Governments introduced national lockdowns, which have impacted both energy consumption and economies. The purpose of this paper is to answer the following question: do COVID-19 lockdowns affect the business cycle? We used the cycle clock approach to assess the magnitude of decrease in electricity consumption in the three waves of the epidemic, namely, April 2020, November 2021, and April 2021. Additionally, we checked the relation between energy consumption and GDP by means of spectral analysis. Results for selected 28 European countries confirm an impact of the introduced non-pharmaceutical interventions on both energy consumption and business cycle. The reduction of restrictions in subsequent pandemic waves increased electricity consumption, which suggests movement out of the economic recession.

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