Economic interdependence and cycle synchronization: the case of Ecuador

Abstract

In this document, we analyze the economic cycles that have affected the economies of various countries. Two logistic regression models were developed to evaluate how Ecuador's main trading partners can influence its economic cycle. The objective was to regress Ecuador's GDP using the GDP of its main trading partners: Colombia, China, the United States, the European Union, Peru, and Russia. The study is based on quarterly data published by central banks, covering the period from 2007 to 2023. For the analysis, time series were decomposed using the Hodrick-Prescott (HP) filter. A significant relationship was observed between the economic cycles of the trading partners and Ecuador, but the latter's economy seems to respond more to internal factors than external ones.