International and intranational business cycles

This paper surveys and analyses the international real businesscycle literature. We re-explore two international business cycleanomalies emphasized by Backus, Kehoe, and Kydland (1995) aswell as establishing the pattern of productivity growth betweenindustries and countries. We then compare these findings forthe international business cycle to those obtained for databetween regions within a country - the so-called 'intranationalbusiness cycle'. Importantly, the intranational business cycleis a natural environment for thinking about the interactionsbetween economies when there are no trade frictions and whenthere are not multiple currencies. We summarize our findingswith a comparison between the stylized facts for internationaland intranational business cycles and draw some policy conclusions.