B efore the incidence of the financial crisis in 2008, the financial sector was ignored in the most of business cycles analyses. It was assumed that the financial sector played no independent role in describing business cycle fluctuations and followed the real part of the economy. In recent years, modeling financial frictions have been much considered in business cycles literature. T...

This paper studies the business-cycle fluctuations predicted by a two-sector endogenousbusiness-cycle model with sector-specific external increasing returns to scale. It focuses on aspects of actual fluctuations that have been identified both as defining features of the business cycle and as ones that standard real-business-cycle models cannot explain: the autocorrelation function of output gro...

We re-examine the evidence on the relationship between credit spreads and economic activity, by constructing a credit spread index based on an extensive micro-level data set of secondary market prices of outstanding senior unsecured corporate bonds over the 1973–2009 period. Compared with the standard default-risk and other financial indicators, our credit spread index is a robust predictor of ...

In this paper we investigate the characteristics of business cycles fluctuations in the countries of the Mediterranean region by applying the Christiano-Fitzgerald bandpass filter to the output series of 12 Mediterranean countries over the period 1950-1998. The main properties of business cycle fluctuations (persistence, volatility, asymmetry and synchronization) are computed with reference to ...