Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean

Using two standard cycle methodologies (Classical and Deviation Cycle) and a comprehensive sample of 83 countries worldwide, including all developing regions, we show that the Latin American and Caribbean cycle exhibits two distinctive features. First, and most importantly, its expansion performanc...

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Autores principales:	Titelman Kardonsky, Daniel, Pérez Caldentey, Esteban, Carvallo, Pablo
Formato:	Texto
Lenguaje:	English
Publicado:	ECLAC 2014
Materias:	CICLOS ECONOMICOS INDICADORES ECONOMICOS BUSINESS CYCLES ECONOMIC INDICATORS
Acceso en línea:	http://hdl.handle.net/11362/5224
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spelling	oai-11362-52242020-03-06T16:50:27Z Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean Titelman Kardonsky, Daniel Pérez Caldentey, Esteban Carvallo, Pablo CICLOS ECONOMICOS INDICADORES ECONOMICOS BUSINESS CYCLES ECONOMIC INDICATORS Using two standard cycle methodologies (Classical and Deviation Cycle) and a comprehensive sample of 83 countries worldwide, including all developing regions, we show that the Latin American and Caribbean cycle exhibits two distinctive features. First, and most importantly, its expansion performance is shorter and for the most par less imtense than that of the rest of the regions considered, and in particular than that of East Asia and the Pacific, East Asia and the Pacific's expansions last five years longer than those of LAC, and its output gain is 50% greater than that of LAC. Second, LAC tends to exhibit contractions that are not significantly different in terms of duration and amplitude than t those of other regions. Both these features imply that the complete Latin American and Caribbean cycle has, overall, the shortest duration and smallest amplitude in relation to other regions. The specificities of the Latin American and Caribbean cycle are not confined to the short run. These are also reflected in variables such as productivity and investment, which are linked to long-run growth. East Asia and the Pacific's cumulative gain in labor productivity during the expansionary phase is twice that of LAC. Moreover, the evidence also shows that the effects of the contraction in public investment surpass those of the expansion leading to a declining trend over the entire cycle. In this sense we suggest that policy analysis needs to increase its focus on the expansionary phase of the cycle. Improving our knowledge of the differences in the expansionary dynamics of countries and regions, can further our understanding of the differences in their rates of growth and levels of development. We also suggest that while, the management of the cycle affects the short-run fluctuations of economic activity and hence volatility, it is not trend neutral. Hence, the effects of aggregate demand management policies may be more persistent over time and less transitory than currently thought. 2014-01-02T15:43:55Z 2014-01-02T15:43:55Z 2013-07 Texto Documento Completo http://hdl.handle.net/11362/5224 LC/L.3656 en Serie Financiamiento del Desarrollo 243 application/pdf AMERICA LATINA Y EL CARIBE LATIN AMERICA AND THE CARIBBEAN ECLAC
institution	Cepal
collection	Cepal
language	English
topic	CICLOS ECONOMICOS INDICADORES ECONOMICOS BUSINESS CYCLES ECONOMIC INDICATORS
spellingShingle	CICLOS ECONOMICOS INDICADORES ECONOMICOS BUSINESS CYCLES ECONOMIC INDICATORS Titelman Kardonsky, Daniel Pérez Caldentey, Esteban Carvallo, Pablo Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean
description	Using two standard cycle methodologies (Classical and Deviation Cycle) and a comprehensive sample of 83 countries worldwide, including all developing regions, we show that the Latin American and Caribbean cycle exhibits two distinctive features. First, and most importantly, its expansion performance is shorter and for the most par less imtense than that of the rest of the regions considered, and in particular than that of East Asia and the Pacific, East Asia and the Pacific's expansions last five years longer than those of LAC, and its output gain is 50% greater than that of LAC. Second, LAC tends to exhibit contractions that are not significantly different in terms of duration and amplitude than t those of other regions. Both these features imply that the complete Latin American and Caribbean cycle has, overall, the shortest duration and smallest amplitude in relation to other regions. The specificities of the Latin American and Caribbean cycle are not confined to the short run. These are also reflected in variables such as productivity and investment, which are linked to long-run growth. East Asia and the Pacific's cumulative gain in labor productivity during the expansionary phase is twice that of LAC. Moreover, the evidence also shows that the effects of the contraction in public investment surpass those of the expansion leading to a declining trend over the entire cycle. In this sense we suggest that policy analysis needs to increase its focus on the expansionary phase of the cycle. Improving our knowledge of the differences in the expansionary dynamics of countries and regions, can further our understanding of the differences in their rates of growth and levels of development. We also suggest that while, the management of the cycle affects the short-run fluctuations of economic activity and hence volatility, it is not trend neutral. Hence, the effects of aggregate demand management policies may be more persistent over time and less transitory than currently thought.
format	Texto
author	Titelman Kardonsky, Daniel Pérez Caldentey, Esteban Carvallo, Pablo
author_facet	Titelman Kardonsky, Daniel Pérez Caldentey, Esteban Carvallo, Pablo
author_sort	Titelman Kardonsky, Daniel
title	Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean
title_short	Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean
title_full	Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean
title_fullStr	Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean
title_full_unstemmed	Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean
title_sort	weak expansions: a distinctive feature of the business cycle in latin america and the caribbean
publisher	ECLAC
publishDate	2014
url	http://hdl.handle.net/11362/5224
work_keys_str_mv	AT titelmankardonskydaniel weakexpansionsadistinctivefeatureofthebusinesscycleinlatinamericaandthecaribbean AT perezcaldenteyesteban weakexpansionsadistinctivefeatureofthebusinesscycleinlatinamericaandthecaribbean AT carvallopablo weakexpansionsadistinctivefeatureofthebusinesscycleinlatinamericaandthecaribbean
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Weak expansions: a distinctive feature of the business cycle in Latin America and the Caribbean

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