HOW MUCH (A)SYMMETRY IN EUROPE - EVIDENCE FROM INDUSTRIAL SECTORS

To what extent do European countries differ with respect to the source s of cyclical fluctuations of industrial output? We look at output dat a disaggregated by industry for 11 European countries, and on the basi s of a cointegrated vector autoregression model we examine the correla tion of output innovations at the industry and country levels. We also discuss to what extent output innovations can be considered 'symmetri c' or 'asymmetric'. Our results point to the fact that, on average, mo re variance of output innovations is explained at the country, rather than the industry level. We also find that the importance of asymmetri c disturbances is quite varied among the 11 countries, and we identify a 'core' of countries with a higher degree of symmetry.