Business cycle synchronisation and the vulnerability of European economies to the 2008-2009 economic crisis

This article analyses the impact of the synchronisation of business cycles of European countries on their vulnerability to external economic shocks in the context of the effects of the 2007-2009 global crisis. The authors combined two macroeconomic problems in the study. These are: on the one hand, the issue of the conditioning of economies to the impact of economic impulses ‘from the rest of the world’; on the other hand, the issue of the synchronisation of business cycles as an effect of economic links/cooperation between countries, but also one of the conditions potentially increasing the mutual vulnerability of countries to shocks. The study showed that in the countries analysed, the level of convergence of cycles alone is not a significant factor directly determining the worsening of the 2008-2009 crisis. Cycle synchronisation – observed in periods of stable economic conditions – therefore does not explain the response of economies to a general economic downturn. In addition, financial market linkages, whose very role in the synchronisation of cycles is ambiguous, played a major role in the spread of the crisis, especially initially.