Business cycle synchronisation in EMU: Can fiscal policy bring member-countries closer?

Stavros Degiannakis, David Duffy, George Filis, Alexandra Livada

Research output: Contribution to journalArticle

7 Citations (Scopus)


The present study adds to the literature on the impact of fiscal policy on business cycle synchronisation. Specifically, it investigates the effects of fiscal policy on business cycle synchronisation between 10 EMU member-countries and the aggregate EMU12-wide business cycle, using a time-varying framework. The findings suggest that fiscal policy has important effects on business cycle synchronisation for all 10 EMU countries. Hence, fiscal policy is shown to have the potential to be supportive of macroeconomic stabilisation in the Eurozone. However, the evidence reveals that none of the countries under examination consistently uses fiscal policy to promote business cycle synchronisation.
Original languageEnglish
Pages (from-to)551-563
JournalEconomic Modelling
Issue numberB
Early online date27 Oct 2015
Publication statusPublished - Jan 2016



  • Time-varying correlation
  • EMU business cycle
  • Business cycle synchronisation
  • Fiscal policy
  • Diag-BEKK model

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