University of Isfahan International Economics Studies 2008-9643 45 2 2015 10 01 Effects of Business Cycles on Bilateral Trade Flows in Eurozone Countries 33 42 21972 10.22108/ies.1917.21972 EN Seyed Komail Tayebi Department of Economics, University of Isfahan, Iran Zahra Zamani University of Isfahan, Isfahan, Iran Behnam Ebrahimi University of Isfahan, Isfahan, Iran Journal Article 2017 01 01 In economic theory, various determinants are considered to explore their effects on trade patterns. Accordingly, business cycles indicate turbulences in economic activities. Business cycles and their fluctuations cause a change in demand for goods and services from the other country then it can affect trade flows. In this study, by using a gravity model, we study the effects of business cycles on bilateral trade flows within Eurozone countries. In this regard, the challenge is that the countries in the region may be faced whit changes in their trade relation in directions whether parametric or non-parametric manners. To be evident, we have used we have used data from six Eurozone countries, namely Germany, France, Italy, Spain, Portugal and Greece for the period of 1995-2013, and then estimate the model with a semi-parametric panel data approach. The empirical results have shown that business cycles explain trade relations non-parametrically in the region. The results imply a transparent unique exchange policy toward their mutual trade flows to avoid outliers in their economic relations.<br /> <strong>JEL Classification: </strong><strong>C14, F10, E32.</strong><br />   https://ies.ui.ac.ir/article_21972_79c82b6dc643dd242ce17d3ec3f0dcd4.pdf