About the network
The Euro Area Business Cycle Network (€ABCN) provides a forum for the better understanding of the Euro area business cycle, linking academic researchers and researchers in central banks and other policy institutions involved in the empirical analysis of the Euro area business cycle.
The establishment of the single currency is a unique opportunity for economists to learn more about the relationship between business cycles, economic institutions, monetary policy and financial markets. This cannot be just a theoretical exercise. There is evident need for high-quality data and empirical research. The Network intends to become a definitive source of data and research output on Euro economies. In time, it will also serve to define the Euro area economic research agenda.
This website has a key role to play in facilitating the exchange of ideas and knowledge at both the conceptual and practical level. We invite all those researchers who are actively engaged in this area, whether they work in institutions such as banks and statistical offices or in academia, to use its facilities to contribute information and research.
Key research areas
Establishing key facts on the Euro area business cycle
In setting out to establish the key facts on the Euro area business cycle, the Network is seeking answers to the following questions:
- what are the driving forces underlying the Euro area aggregate business cycle? What is , for example, the evidence on the conjecture that the US and UK cycles are driven by consumption while the Euro area cycle would be driven by investment?
- can a set of stylised facts characterising the Euro area business cycle be put together? Is there in particular a meaningful or preferred definition of the Euro area business cycle and of its corresponding turning points? What would then be the differences with respect to the US, viewing this country as a sort of empirical ‘benchmark’?
- can the Euro area be treated as a closed economy? To what extent is the Euro area cycle linked to or affected by cyclical developments elsewhere?
- what are the various types of linkages to the rest of the world, how important are these and have these changed over time?
Monitoring business cycle in practiceMonitoring the business cycle entails:
- discovering whether significant differences in business cycle behaviour across the Euro countries can be quantified and identified (in terms e.g. of co-movements and lead-lag relations)? Why are there, if any, still substantial differences in business cycles after monetary union took place;
- identifying the relevant coincident and leading indicators to the Euro area cyclical developments. Several national banks are already systematically comparing available Euro area coincident indicators and one objective is to co-ordinate such exercises;
- determining if there is, for example, a particular role for monetary and financial indicators in predicting output and inflation;
- assessing indices such as core inflation, national and sectoral indicators, such as service sector indicators;
- ascertaining whether error in assessing the cyclical position of the relevant economy affects policy decisions and how this is (or should be) taken into account.
Research into methodological issues includes:
- forecasting evaluation and data mining;
- aggregation — what, for instance, is the best way to take into account heterogeneity of national cyclical features?
- methods for the analysis of large panels;
- the econometric of structural change.
Become a member
All those who wish to become a member of the Network can apply online using this application form. Membership is free.
Applicants who are fellows or affiliates of the CEPR or NBER or who are involved in research at a funding institution can become members as of right. All applications, however, are reviewed by the Scientific Committee. Applicants will be informed by the Network Secretariat when their application has been successful and their names will be posted on the Fellows page.