Business cycles of India, developed and developing economies: A test of co-movements Kaur Sumanpreet Senior Research Fellow (NET/UGC), Department of Economics, Panjab University, Sector-14, Chandigarh-160014, India. Email: preet.suman912@gmail.com JEL Codes: E32, C12. Online published on 23 January, 2019. Abstract This study aims at casting some light on the co-movements of the Indian economy vis-a-vis some of the developed and developing economies as a contribution to the constant debate on independence of emerging economies business cycles from those of the advanced nations. An attempt has been made to test the proposition of India's independence against the developed group consisting, Australia, Canada, France, Germany, Italy, Japan, U.K. and U.S.A. and the developing group consisting, Argentina, Brazil, China, Hong Kong, Indonesia, Mexico, Malaysia and Qatar. The annual data from 1970 to 2016 has been sourced from World Development Indicators on nominal GDP for calculating output gaps and Euclidean distance for graphical analysis and the econometric analysis for testing the hypothesis. The graphical plots led to the refutation of independence hypothesis for all the economies and the econometric analysis also reveals the presence of business cycle co-movements between India and Australia, Canada, Italy, Great Britain and United States of America from the developed world and for Brazil, China and Qatar from the developing world. Top Keywords Business Cycles, Output gap, Euclidean Distance, Hypothesis Testing. Top |