Cyclical Synchronization of the Czech Republic and the Euro Area

English article in American scientific (peer-reviewed and impacted) journal Eastern European Economics, which focuses on the issue of gaps in the synchronisation of the Czech economy with the Euro Area. I wrote the article in collaboration with Jakub Bechný.

Abstract

The paper investigates the cyclical synchronization of the Czech Republic with the euro area and compares it to the synchronization of Germany and Austria (the benchmark). We employed a wavelet coherence analysis with four macroeconomic variables and monthly data from 1995 to 2019. Our results suggest that the Czech Republic suffers from significant structural disparities in synchronization at high frequencies. The country is related to most of the euro area countries only indirectly. Additionally, both benchmark countries are well synchronized with the euro area at almost all frequencies, except Austria in the manufacturing sector.