Economic Integration, Business Cycle, and Productivity in North America

 
Author/Editor: Cardarelli, Roberto ; Kose, M. Ayhan
 
Publication Date: August 01, 2004
 
Electronic Access: Free Full text (PDF file size is 660KB).
Use the free Adobe Acrobat Reader to view this PDF file

 
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: This paper examines the effect of the major Canada-U.S. trade agreements on the dynamics of business cycles and productivity in Canada. The North American Free Trade Agreement (NAFTA) and its predecessor, the Canada-U.S. Free Trade Agreement (CUSFTA), have led to a substantial expansion of trade flows. Although common factors have played a larger role in explaining business cycles in Canada and the United States since the early 1980s, country-specific and idiosyncratic factors remain important for Canada. At the same time, while increased trade integration seems to have positively contributed to total factor productivity of Canadian industries, the persistence of structural differences between the two countries has prevented convergence of aggregate labor productivity. While these findings seem to weigh against moving toward a monetary union, they also suggest that substantial benefits could be reaped from further reducing remaining barriers to trade.
 
Series: Working Paper No. 04/138
Subject(s): Business cycles | Canada | United States | Productivity | Trade | International trade agreements | North America

Author's Keyword(s): Canada | United States | Business Cycles | Productivity | NAFTA | CUSFTA | Regional Trade
 
English
Publication Date: August 01, 2004
ISBN/ISSN: 1934-7073 Format: Paper
Stock No: WPIEA1382004 Pages: 46
Price:
US$15.00 (Academic Rate:
US$15.00 )
 
 
Please address any questions about this title to publications@imf.org