This article considers the evolution of international business cycle interdependenciesudamong 27 developed and developing countries since the beginning of 1870s, utilising theudgeneralized vector autoregressive (VAR)-based spillover index of Diebold and Yilmaz (2012),udwhich allows the construction of a time-varying measure of business cycle spillovers. We find that, on average, 65% of the forecast error variance of the 27 countries' business cycle shocks is due to international spillovers. However, the magnitude of international business cycleudspillovers varies considerably over time. There is a clear increasing trend since the end of World War II and until the middle 1980s. After that, international business cycle interdependencies declined during the period that was dubbed the Great Moderation, and stabilizedudaround the beginning of the twenty-first century. During the Great Recession of 2008-2009,udinternational business cycle spillovers increased to unprecedented levels. Finally, developedudcountries are consistently ranked as net transmitters of cyclical shocks to developing countiesudthroughout the sample. (authors' abstract)
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