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Frontiers in Finance and Economics is a UGC APPROVED International Journal of Research

Interdependence of Asean Business Cycles

Hway-Boon Ong, Chin-Hong Puah, Muzafar Shah Habibullah
This paper examines the interdependent relationship of five ASEAN business cycles, namely, Indonesia, Malaysia, Philippines, Singapore and Thailand. We conducted an augmented VAR of Granger non-causality test and discovered that there is strong interdependence among the ASEAN countries under study.  Our empirical findings revealed the existence of bi-directional causality among ASEAN countries, especially Malaysia and Singapore. That is to say, economic shocks or policy implementation by any neighbouring countries may be easily transmitted to another.
Keywords: Granger non-causality, augmented-VAR, MWald test, business cycles, ASEAN.
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