Social and Behavioral Sciences Commons^™

Stylized Facts Of Business Cycles In The G7 From A Real Business Cycles Perspective, Riccardo Fiorito, Tryphon Kollintzas

riccardo fiorito

This paper investigates the basic stylized facts of business cycles in the G-7 countries using quarterly data (1960-89). The methodology is based on Kydland-Prescott (1990). The evidence suggests that the RBC model can account for several major stylized facts for all seven countries. In particular, consumption is procylical and fluctuates more than output; net exports are countercyclical; prices are countercyclical; government consumption and money do not have a clear cut pattern.