Michele Lenza, Lucrezia Reichlin, Domenico Giannone, 15 January 2009

This column argues that the introduction of the euro has not changed the historical pattern of member countries’ business cycle correlations. The IMF outlook for economic activity over the next few years implies that the current recession will not change it either.

Tommaso Monacelli, Roberto Cardarelli, Alessandro Rebucci, Luca Sala, 26 April 2008

Recent housing finance innovations have changed the relationship between house prices and the business cycle. This column suggests that these changes amplify spillovers from the housing sector to the rest of the economy and recommends that monetary policy respond more aggressively to the housing market.

Yoonsoo Lee, Toshihiko Mukoyama, 07 January 2008

It is commonly believed that business cycles ‘cleanse’ industry with waves of creative destruction. New research shows that entry is higher in booms than busts, but exit rates and the type of exiting firms, are steady over the cycle. Plants entering during recessions, however, are larger and more productive –‘creative entry’ rather than ‘creative destruction’.

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