Dokument

Summary:
The goal of the present paper is two-fold. First, I explore the impact of di¤erent trade patterns on industrial specialisation and consequently on business cycle co-movements between and within di¤erent regions. Es- pecially, I emphasize industrial specialisation as a result of intra- or inter- industry trade. Furthermore, I justify the predictions of di¤erent theo- retical trade models on the basis of my results . Second, I analyse the degree of risk-sharing between and within the regions in dependence of the previous step. In particular, the purpose is to clarify direct and indi- rect channels between trade, specialisation, business cycle co-movements and risk sharing. The expectations are that countries within a region with homogeneous specialisations show intra-industry trade. Hence regional business-cycles converge. Consequently, risk-sharing within these regions is not possible. These countries tend to be more internationally …nancially integrated than regionally. Inter-industry trade arises in countries within regions with heterogeneous specialisation. As a result regional business-cycles diverge. Now, countries can share risk within the region. Regional …nancial integra- tion is stronger for these countries than international …nancial integration. One further question is: do the same patterns create risk sharing also in the means of consumption co-movements between or within a region?

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