Economic Interdependence: Evidence from China and ASEAN-5 Countries
- 1
- 2
- 3
Abstract
This study aimed to examine the interdependence relationship among five Association of Southeast Asian Nations (ASEAN-5) countries (Indonesia, Malaysia, the Philippines, Singapore, and Thailand) and China from a business cycles perspective. The Granger non-causality test proposed by [1] was used to examine causal linkages in business cycles. The empirical results indicated common business cycles between China and ASEAN-5 economies. This suggested that China and ASEAN-5 share similar business cycles and could complement each other in the long run. A discussion of important insights for regional economic policy coordination in which similar business cycles provide a platform for common regional trade, as well as suggestions for monetary policies, conclude the paper.
- H. Y. Toda and T. Yamamoto, “Statistical Inference in Vector Autoregressive with Possibly Integrated Processes,” Journal of Econometrics, Vol. 66, No. 1-2, 1995, pp. 225-250. doi:10.1016/0304-4076(94)01616-8
- D. D. Selover and D. K. Round, “Business Cycle Transmission and Interdependence between Japan and Australia,” Journal of Asian Economics, Vol. 7, No. 3, 1996, pp. 569-602. doi:10.1016/S1049-0078(96)90057-3
- D. D. Selover, “Business Cycle Transmission between the United States and Japan: A Vector Error Correction Approach,” Japan and the World Economy, Vol. 9, No.3 1997, pp. 385-411. doi:10.1016/S0922-1425(96)00241-1
- D. D. Selover, “International Interdependence and Business Cycle Transmission in ASEAN,” Journal of Japanese and International Economies, Vol. 13, No. 3, 1999, pp. 230-253.doi:10.1006/jjie.1999.0436
- D. D. Selover, “International Co-Movements and Business Cycle Transmission between Korea and Japan,” Journal of Japan and International Economies, Vol. 18, No. 1, 2004, pp. 57-83. doi:10.1016/S0889-1583(03)00025-X
- S. Hamori, “The Transmission Mechanism Of Business Cycles Among Germany, Japan, the UK and the USA,” Applied Economics, Vol. 32, No. 4, 2000, pp. 405-410. doi:10.1080/000368400322589
- S. Sayek and D. D. Selover, “International Interdependence and Business Cycle Transmission between Turkey and the European Union,” Southern Economic Journal, Vol. 69, No. 2, 2002, pp. 206-238. doi:10.2307/1061670
- T. Bezmen and D. D. Selover, “Patterns of Economic Interdependence in Latin America,” The International Trade Journal, Vol. 19, No. 3, 2005, pp. 217-267. doi:10.1080/08853900591007339
- H. B. Ong, C. H. Puah and M. S. Habibullah, “Interdependence of ASEAN Business Cycles,” Frontiers in Finance and Economics, Vol. 3, No. 1, 2006, pp. 69-78.
- H. B. Ong and M. S. Habibullah, “The ASEAN-5 Economic Alliance: A Time Varying Convergence Analysis,” International Research Journal of Finance and Economics, Vol. 8, 2007, pp. 97-106.
- E. Lau and K. P. Lee, “Interdependence of Income between China and ASEAN-5 Countries,” Journal of Chinese Economic and Foreign Trade Studies, Vol. 1, No. 2, 2008, pp. 148-161. doi:10.1108/17544400810884718
- The Economist, “United We Fall,” 2002. http://www.economist.com/node/1336091
- R. J. Hodrick and E. C. Prescott, “Post-War U.S. Business Cycles: An Empirical Investigation,” Discussion Paper, Carnegie Mellon University, Pittsburgh, 1980.