Page - 97 - in The Austrian Business Cycle in the European Context

97 8.2.2 Determination of the business cycle by a dynamic factor model approach Instead of determining the business cycle by the cyclical variations found in Austrian gross value added (without agriculture and for- estry} as outlined before, the business cycle is now specified by the common variation found in all observed time series. This approach has already been presented in chapter 4.1.2. In order to avoid a bias caused by including time series with a definition rather close to each other, some of them have been discarded from the data pool. Common variations are extracted out of the following series autf: the Austrian construction sector autCDE: the Austrian industrial sector (including mining and quar- rying and electricity} autGHI: Austrian services in trade, restaurants, transport and com- munication autJK: Austrian services in financial intermediation, real estate and business activities autGV Aex: Austrian gross value added excluding agriculture and forestry eurGDPex: euro area GDP excluding Austria and Germany gerCDE: the German industrial sector (including mining and quar- rying and electricity} gerf: the German construction sector gerGHI: German services in trade, restaurants, transport and communication