This paper investigates empirically the differences in time?series behavior of key economic aggregates under alternative exchange rate systems. We use a postwar sample of 49 countries to compare the behavior of output. consumption, trade flows, government consumption spending, and real exchange...

This paper studies the international transmission of business cycles by developing a two-country real business-cycle model and confronting it with a broad set of empirical observations. These observations include variances and covariances of output, labor, consumption, employment, and investment...

Economic theory predicts connections between fluctuations in a country's exchange rate and its real GDP relative to other countries. Past evidence of such connections has been very weak. An examination of periods of large or sustained changes in GDP (rather than small, temporary changes),...