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Many papers have analyzed international business cycle linkages, trying to gauge the stylized features and the co-movement of economy-wide fluctuations across countries. Globalization -the process of continuing integration of the countries in the world- has enhanced the degree of synchronisation of cross-country business cycles over the past three decades. A large role has been attributed to spillover effects from the US to other countries and not in the opposite direction , with negative growth shocks being more readily transmitted from the US to other countries than positive ones2. A simple correlation between the US and the world’s GDP growth excluding the US highlights an increased importance of the US economy to the world’s business cycle (Figure 1a), despite the falling contribution of the US economy to global growth (from almost 30% in 1950 to about 20% in mid-2000s and around 10% currently).