Research

The paper documents stylized facts about Belarusian business cycle based on aggregate and industry data and puts it into an international content. First, the aggregate fluctuations in Belarus are mostly driven by the wedge, which resembles a time-varying investment tax. Second, the fluctuation in relative prices of an industry is typically more important than volume fluctuation. Furthermore, the impact of price fluctuations is partially offset by volume fluctuation. Third, the aggregate cycle is smoother than the industry-specific one. In particular, agriculture, construction and finance experience a very sharp drop in a recession.